Live within your means, it's so simple.
Posted on 09/24/2008 11:49:01 PM PDT by FocusNexus
Honestly. A clean bill as requested by Treasury man Henry Paulson, along with John McCain's oversight board, can help fix the credit-crunch problem. It needn't be this hard.
According to the Paulson plan, distressed assets will be sold by banks through a reverse auction (the low bid wins) to various investment funds, hedgies, private-equity boys, and other banks. And taxpayers will have a strong ownership position in these asset sales. When the assets are worked out over time -- as they will be once housing and the economy recover -- taxpayers will actually make money on the deal.
But after Tuesday's Senate hearing I'm very concerned. The bells and whistles that would be attached to Paulson's plan by our Democratic friends are anti-capitalist and anti-opportunity.
Capping compensation for both the selling and purchasing institutions? What? Salaries and bonuses are no business of the government. People go to work for profits. For opportunities. It's at the heart of our free-market capitalist system.
I can understand legitimate concerns about a big-government intervention and a giant $700 billion number. There's a shock effect here. But once in a while the financial center of capitalism goes into panic mode and something has to be done.
Actually, it's a marvel that we permit government to infrequently come to the rescue of our credit system. It doesn't happen everyday. But it has been necessary going all the way back to Alexander Hamilton's original rescue of our failing debt system in the 1790s.
Understanding this history, conservatives should not panic or walk away from the Paulson assistance plan. It would be great to avoid either a deep credit-driven recession or a global banking meltdown -- or both. Paulson has always viewed his rescue plan as an economic-growth tool. I think he's right.
(Excerpt) Read more at realclearpolitics.com ...
Capping compensation for both the selling and purchasing institutions? What? Salaries and bonuses are no business of the government.
this is more socialist than the actual bailout
Since when are criminals entitled to big checks?
IMHO, any portion of the salary over a certain amount should be put in escrow for some period of time (say two years). If the company avoids further defaults in that time, great. Otherwise, the escrow is used to pay off creditors.
you mean the ones in congress?
Even so, I don’t see why an executive should receive a huge bonus when a publicly traded company is losing money. If they want to ban that kind of looting it is fine by me.
I just don’t want the govt in charge of that and especially once you move beyond AIG, lehman, etc to anyone that buys/sells those assets
The fact that the house of CarDS is standing is the primary problem. The bailout would build the house even taller.
What's needed is a controlled demolition. It may be necessary to inject some money to manage the fall (e.g. offering partial insurance for people who don't immediately bail out on money market funds) but the economy will not be sound until the house of CarDS comes down.
I meant the ones on Wall street, but I guess you could apply it either way.
Paulson doesn’t need a clean sweep. America does. We should toss out of all these worthless schmucks.
they forfeited the right to set their own salaries when they went hat in hand to the government, IMHO.
Oh, what a pity for this otherwise marvelously capitalist, free-market bill...
>> According to the Paulson plan, distressed assets will be sold by banks through a reverse auction (the low bid wins) to various investment funds, hedgies, private-equity boys, and other banks.
Not according to Bernanke! He wants to buy this toxic waste at something he calls “held-to-maturity value”.
In other words, instead of paying fire sale prices — he wants to pay top dollar. No reverse auction.
well, comapnies are not going to buy the junky assets if the govt puts a compensation cap. and if they don’t buy, the taxpayers will get a bigger bill.
I’ve decided that if the taxpayers are paying for this, why don’t they just take the 700 billion, divide by 300 million, and just give all US citizens 233,333,333 dollars..
Okay, I’m really bad at math, but I think that’s right.
Can anybody explain this concept to me?
I'm thinking I'd like to bid $0 for the lot of them. Would I win the bid?
Seriously.
Anyone?
Anyone?
If they don’t accept compensation caps and their companies collapse, they’d be in violation of their duties to shareholders, and perhaps even criminal laws.
“I meant the ones on Wall street, but I guess you could apply it either way.
Paulson doesn’t need a clean sweep. America does. We should toss out of all these worthless schmucks.”
Someone on CNBC the other day responded to those cheering the Wall Street crisis, with opinions such as yours that those “fat cats” deserve what’s coming to them, with an anecdote.
He said that his grandfather reacted the same way at the beginning of the 1929 crash, then a year later he lost his store and was broke.
The point is that while the constant promotion of class warfare by the MSM influences people’s thinking and many thing “the rich deserve what’s coming to them” — these crises DO impact everyone.
Ordinary people needing to get a loan can’t get them, then they can’t purchase things they need, things are not sold, workers get laid off, people don’t have money, the economy starts to collapse.
These are the extraordinary times when the government is indeed the only one big enough to help out to stabilize the economy.
Kudlow? If he’s for it I know it’s the wrong way to go. Yeah lets help banks keep prices high.
Live within your means, it's so simple.
But it's still an interesting thought. Why not just spread the wealth? Why give it to a few who happen to have "become accustomed to the lifestyle?" I mean, if it all goes to consumers it will wind up in a bank at the end of the day anyway (after they buy whatever they buy).
It sounds ludicrous, but how is it anymore ludicrous than the current plan? Either way we're going to get a mess of inflation. Why not let us all have one last hurrah before it goes to the dogs?
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