In brief: the failure of the bailout

[demiurgent]

It's surprisingly simple.

Neither major political party was willing to sacrifice the election to save the nation.

There is nothing more basic than that. Neither party would sacrifice personal power in order to save the economy of the United States of America.

My representative voted Nay. For the first time, I'm considering voting against her in November. I'm certainly calling her office tomorrow to express my deep disappointment in her.

For those who don't want to see the bailout of Wall street firms because gorsh, they's all rich and it's not fair? I hope you really, really enjoy the next ten years.

Comments

[snowspinner.livejournal.com]

There is no country on the planet that does not have financial institutions that are heavily invested in mortgage backed securities. This is not a US economy collapse, this is a global economy collapse.

[richm90071.livejournal.com]

Funny you should mention that. I turned up something interesting while researching this.

According to Karl Denninger, the bailout is primarily for the benefit of foreign banks (http://market-ticker.denninger.net/archives/596-The-TRUTH-About-The-Bailout.html), not US banks. Representative Brad Sherman (http://globaleconomicanalysis.blogspot.com/2008/10/rep-brad-sherman-on-bailing-out-foreign.html) confirms that this is the case. Backing up these claims are statements from UK Prime Minister Gordon Brown (http://afp.google.com/article/ALeqM5ijNM_cMwGE1tTgw7S77ClXislztw) and European Central Bank President Jean- Claude Trichet (http://www.bloomberg.com/apps/news?pid=newsarchive&sid=awjusn9I2MWk), asserting that it is the responsibility of the US government to bail out global finance and fix the global economy.

That may be slightly beyond the even US government's ability to make problems go away by throwing massive amounts of money at them.

[snowspinner.livejournal.com]

If this were a bailout in the traditional sense, I'd agree. But the US government stands to profit massively on this.

Yes, this ends up repairing the global finance system. To say that's not for the US's benefit is absurd, though - it's not like our economy is insulated from the global economy. And it's not like there are many other institutions with the ability to invest $700 billion.