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What makes you think that sinking trillions of dollars into bailouts or stimulus pkgs such as T.A.R.P.?
will turn the economy around any faster then letting these companies file protection through bankruptcy?
I understand the concerns I'm hearing, but...Sheila Bair, the chairman of the FDIC, seems to think that the best course of action would be to let them file under reorg. provisions. Her backround includes Government Relations of the NYSE, Commissioner and acting chair of the Commodity Futures Trading Commission, Selected to the WSJ's Smart Money Mag. ' Power 30' most influential people in investing, and her appointment to the fdic is a Presidential appointment with senate confirmation. I realize it's just another opinion crying out in the darkness, but not everyone is convinced that if AIG goes down, all will follow.
Bring it on RPL. I am interested in your opinion.
17 Answers
- Anonymous1 decade agoFavorite Answer
The two stimulus packages ($787 Billion and $410 Billion) passed by the democrats will have very little positive effect on the economy. The experts are still saying it will take until the end of 2010 to really bottom the economy out before it will regain. The two stimulus packages also had just less than $300 Billion for economic stimulus so in that very fact Obama is not really working on the economy. The now $4.2 Trillion fiasco called the budget has a $2 trillion budget deficit that has nothing to do with Bush or his administration. Obama ran on a promise of change and is now even with Bush on spending and none of it is going to really help the economy. Now they are talking about a $1.5 trillion 3rd stimulus bill, why, they know the first two will not work. But all this does is add to the debt.
$0.787+$0.410+$4.2+$1.5=$6.897 Trillion spent in Obama's first year. How pathetic. We increased our debt by 50% in one year and the economy is still not rebounding and the experts say the money will not stop the slide. Bush gave us a $10.5 trillion debt, Obama just made it $15 trillion. You grand childrens money has been spent and they are now going after your great grandchildrens money.
Your choice, continue to support the clueless wonders in office or bounce them out and replace the entire lot and start new. Real change. Not one person in Congress now can be trusted with money but the voters keep voting them in as if they will change their ways........LOL
Insanity is doing the same thing over and over and over but expecting a different outcome each time. Barney Frank and Ted Kennedy and Pelosi have proven track records of NOT helping the American tax payer but the idiot voters keep putting them back in hoping this time they will change......"Change" LOL
- Noah HLv 71 decade ago
Bankrupcy wouldn't deal with problem. The problem that there's no cash or credit in the system. In simpler terms there's a glut of production and nobody is buying because they can't. Wages have been far too low for too long for too many people. To 'consume' you need cash and there hasn't been enough of that for a long time. So, cash got replaced by credit, now there's no money to pay for the credit extended. Banks won't loan anymore....certainly not to 'increase production' when goods are stacked up in warehouses all over the planet. People borrowed a lot of equity on their homes to 'consume'.....suddenly there were no buyers for those homes...no cash...no credit....paper wealth went the way of the buffalo. That leaves ONLY government spending to get cash and credit back into the system. This will work, but I doubt if we'll see another 'bubble' like this last one for a generation. We're all going to be poorer.....you can take that to the bank! No kiddin'!
- Team CaptainLv 51 decade ago
If they fail, they'll take the entire banking/financial industry down with them. We need a banking/finance industry if we want capitalism. You do want capitalism, don't you? Because if they fail, the US government becomes really the only big lender and bank. Perhaps we should have had better regulations in place and never let this happen at all, but hindsight is 20/20.
- Anonymous1 decade ago
It won't. We will need to borrow 2 trillion dollars this year, and the Chinese are getting sick of buying our debt. The rest of the world is worse off than we are. The UN is considering trashing the dollar. All of this and the Demcorats are whining about 165 billion in bonuses that they approved in the first place.
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- Anonymous1 decade ago
odds are bankruptcy would mean a lot of re-organization and massive layoffs... like about double the layoffs we have now ... when you count CITI, BOA, GM, AIG and others... that have gotten bailouts... huge employers...
we are trying to avoid 20 percent unemployment...
may happen any way... but if we get there, you'll figure out pretty quick why a few trillion was a steal of a deal if it worked...
- robert fLv 41 decade ago
The ripple effect of these large corporate giants filing bankruptcy would be tremendous. Thousands of small businesses connected to these companies would not be able to collect monies owed them. These smaller businesses would not survive either.
- BubuhLv 51 decade ago
Companies could restructure under bankruptcy, but imagine several big names announcing bankruptcy just days, weeks apart. What do you think it will do to the market? Stock market.
- 1 decade ago
It is the same principle as I don't think you will have a job if your company closes down. It is a domino effect. I do not think pumping cash into them makes them solvent, but letting them go down is not an option.
- FatefingerLv 71 decade ago
Because the lying liberal driven media tells us. It's a load of crap. The more this is going on the more dissent is being created and the more dissent the more hostility. All this is doing is turning Americans into a bunch of "domestic terrorists" if your basing that term off "the modern militia movement"
Actually I would say within a few months American society will collapse, totally. Just as obama planned it.
- ZacLv 51 decade ago
it's all B.S., I don't see them helping out small businesses or even medium size businesses and then to hear that these companies are using the money to pay ceo bonuses with....i'm furious and will possibly witness the end of the greastest country on earth in my lifetime. (I hope not but it seems to be going that way)