Stock Market Crashing??

[oakranger]

Thats actually a bit of a stretch. While China is by far the largest market in overall potential its ability to successfully market products to other markets is somewhat lacking. India is a much more viable threat (along with Brazil) as up and coming economic super powers. So far the real issue seems to be who will capture the import market for China...not what China will export. The current US struggles are a direct result of an increasingly low standard for domestic leadership and tolerance of corruption and stupidity. We suffer from massive corruption all the way down to the city level (of all sizes). what's really needed is some serious accountability for all the pork barrel graft and out right criminal activity by our elected officials (among others)...

All you need to do is look at our current choices, neither of them is even remotely qualified for the task at hand. We now have government by the lowest common denominator and its showing. It wont matter who "wins" since the end result is going to be the same....we'll see a mixed "bail out" that will make billions for a select few and send us into a true depression. hopefully we'll actually elect some truly independent congressmen (vote every incumbent out on both sides) who initiate a real probe into the current broken system and roll a few heads. If you can put CEO's in jail you can put serving congressmen there as well.

Can we just do  a ya old fasion of stoning all the CEOs who just have to much money.

[humble]

90%+ of CEO's earn every penny they get. The problem isn't really in corporate America per se. It's in our bloated pork barrel style government. This isn't a democratic or republican issue, the current administration is probably the worst ever. Literally billions of $$$ are being sucked out each year in Iraq alone. This is corruption on a scale so large its actually treasonous in my opinion. The issue here isnt the few large highly publicized corporations that are corrupt or at risk, its the 1000's of smaller firms that drive the economy of the nation, create real wealth and economic growth. Every single one of the fortune 500 should be allowed to fail (many are actually in good shape) if they are in trouble. There are plenty of other firms with better management that can absorb them. what we need to do is create a mega fund that will lend American money to American firms at zero interest for 10 yrs to facilitate this. Keep the ownership American and dont let Biff and Buffie use US tax dollars to snap up quality midsize firms that become starved for capital (this is the entire real intent of the "bail out". The crisis is one of liquidity, the banks are keeping money and creating a credit crisis. what the 700 billion will do is allow these scum suckers to retire bad debt and keep money tight, they will use this to leverage small sound firms who've relied on reasonable cost of money for growth. So the rich and feeble will buy tomorrows technological leadership for pennies on the $$$ via a crisis they've created.

[choker41]

Screw giving that money to people who made the mistakes.  Give me my share of the 700,000,000,000 and I'm guessing that would be around 15K-20K.  I will pay of my debt which interns puts money into the banks and would make all who is 18 yrs and older stimulate this economy.  I'm sure I'm way off but ist 12:30am and have to get up in 4 hrs.  It makes sense to me right now but might change my mind in the morning. <S> to Humble who has shed some light on this difficult subject for which most of us will not understand.

[oakranger]

90%+ of CEO's earn every penny they get. The problem isn't really in corporate America per se. It's in our bloated pork barrel style government. This isn't a democratic or republican issue, the current administration is probably the worst ever. Literally billions of $$$ are being sucked out each year in Iraq alone. This is corruption on a scale so large its actually treasonous in my opinion. The issue here isnt the few large highly publicized corporations that are corrupt or at risk, its the 1000's of smaller firms that drive the economy of the nation, create real wealth and economic growth. Every single one of the fortune 500 should be allowed to fail (many are actually in good shape) if they are in trouble. There are plenty of other firms with better management that can absorb them. what we need to do is create a mega fund that will lend American money to American firms at zero interest for 10 yrs to facilitate this. Keep the ownership American and dont let Biff and Buffie use US tax dollars to snap up quality midsize firms that become starved for capital (this is the entire real intent of the "bail out". The crisis is one of liquidity, the banks are keeping money and creating a credit crisis. what the 700 billion will do is allow these scum suckers to retire bad debt and keep money tight, they will use this to leverage small sound firms who've relied on reasonable cost of money for growth. So the rich and feeble will buy tomorrows technological leadership for pennies on the $$$ via a crisis they've created.

I dont know about the 90%.  More like 10%.  Other than that, WE ARE SCREWED

[humble]

Screw giving that money to people who made the mistakes.  Give me my share of the 700,000,000,000 and I'm guessing that would be around 15K-20K.  I will pay of my debt which interns puts money into the banks and would make all who is 18 yrs and older stimulate this economy.  I'm sure I'm way off but ist 12:30am and have to get up in 4 hrs.  It makes sense to me right now but might change my mind in the morning. <S> to Humble who has shed some light on this difficult subject for which most of us will not understand.

700 billion actually is only about $2,300 or so per person based on the last census. That is the true underlying issue here. Remember we just had a economic stimulus package, we're talking about relatively small amounts of money overall within the context of the problem. what good did the last package due...not a thing. The entire goal is to put money in circulation. We tried to prime the pump at the grass roots level. The reality is most of that money went to service the same bad debt we still have. Now the theory is that by buying large amounts of worthless debt we will free up banks to lubricate the economy by creating liquidity. The problem is that the banks will have much tighter credit regardless. The only difference is if they can offload their bad paper or not. A buy out will allow them to maintain the accumulated private wealth while re-capitalizing the firms them selfs. This wealth will be used to acquire firms that need capital to maximize growth. So we will have a lot of mergers driven by need for capital. In addition these firms will buy large swaths of land at deep discounts which will sit idle for a decade or more and then be developed at huge margins beginning this cycle again in 20 years.

[oakranger]

700 billion actually is only about $2,300 or so per person based on the last census. That is the true underlying issue here. Remember we just had a economic stimulus package, we're talking about relatively small amounts of money overall within the context of the problem. what good did the last package due...not a thing. The entire goal is to put money in circulation. We tried to prime the pump at the grass roots level. The reality is most of that money went to service the same bad debt we still have. Now the theory is that by buying large amounts of worthless debt we will free up banks to lubricate the economy by creating liquidity. The problem is that the banks will have much tighter credit regardless. The only difference is if they can offload their bad paper or not. A buy out will allow them to maintain the accumulated private wealth while re-capitalizing the firms them selfs. This wealth will be used to acquire firms that need capital to maximize growth. So we will have a lot of mergers driven by need for capital. In addition these firms will buy large swaths of land at deep discounts which will sit idle for a decade or more and then be developed at huge margins beginning this cycle again in 20 years.

You must have a degree in economics.

[ColKLink]

Funny how a barrel of oil drops in price, when the buyer AINT GOT NO MONEY,...lol It's been a fine 8 yrs huh???? phew.

[JimmyC]

  Snaphook for President

[Wayout]

i didnt believe it would happen in my life time and here it is, i started to crash this morning
700 billion dollar bail out, and 66% of republicans voted no?
why?

Same reason 40% of the Dems voted no, it's a bad deal.

[Nilsen]

The more you say no to the rescue package the more money I make over here. Keep saying no and crash even harder 

[Mr No Name]

IN

[captain1ma]

INdeed

[john9001]

a 7% decline is not a crash, it is a buying opportunity.  Of course if it keeps going down......


the fix is simple.

A change from mark to market accounting of assets to a rolling 3 year avg. ( i'm not going to explain it, look it up , do your homework) That by itself would free up capital for loans.

B No bailout gifts, make it a loan at 2% over treasury rates payable in 5 years. Let them work out of the bad debts, (Chrysler repaid the govt loan with interest ahead of time).

C Fire Paulson, he is the former head of goldman-sacks, goldman-sacks had a 20 billion stake in AIG, paulson gave AIG 85 billion. Conflict of interest.

No ,i'm not a economics expert, but i know someone who is.

[humble]

There are only 2 forms of accounting, asset based or cash based. The problem is that current accepted accounting practices allow for an asset to be carried for a period of 5 yrs at its purchase price. This is the underlying issue that caused the problems at Enron. The asset's lowered in value but the reported book keeping number remained high...the firm kept looking for additional assets to keep the balance sheet healthy and they also collapsed. So when the boks had to be adjusted they had a sudden major loss. Then under scrutiny other assets that had not hit the 5 yr limit were also very overstated with regard to current value.

The accounting practice itself in no way effects the amount of capital available for loans IMO. But what we have is a poor repeating business cycle. The CFO's major job in a big corporation is actually to support the CEO in his efforts to positively impact stock value (CEO's only true job). To do that he builds strong relationships with analysts/investment banks and then looks for ways to impact the firms balance sheet in a positive way. Very often firms are bought and then fractionalized. The end result is often a short term double whammy on the books as assets are carried at the inflated price and then cash/assets shown for spinoffs while charge offs are taken for restructuring. So we create both artificial gains and losses to manipulate the balance sheet. When in reality often these moves stifle innovation and have a true negative impact...so we have a "paper gain" and a true loss of value. This helps to explain how we had a "paper gain" {stock market} and a real errosion of output and a plummeting dollar. Our "investment banking" industry went from being bankers to being manipulators. The highest paid people on wall street are derivatives analysts, which highlights the issue. Basically these are the guys who create artificial metrics to game the system. So we went from a nation of builders of wealth to a nation of "gamers on wealth".

For every Bill Gates who can generate billions in real wealth we have 1000's of 3rd, 4th or higher generation "skippy the Vth" who went to princeton to play tennis and lives of the family trust fund. These relatively small numbers of very high value accounts drive a lot of this problem. These are the accounts that make money and then the major funds follow the trend. The "insider money" pulls out and the broader market is often left holding the bag. The policy makers and lobbiests who control the economics of wall street are the very same people who are managing the "bail out" ... which is where all those trillions of $$$ of profit are now safely sitting...waiting for the chance to "help us" out of a problem they created. 

[moot]

Humble you're supposed to stop being so pertinent and informative and just post 'IN'