Assets My ***!

O k.  I know nothing.  I am a school bus driver.  I dropped out of three colleges. I don't know if I'm for or against the bailout.   But my simple mind has always assumed that an asset is a good thing.  No?  Am I crazy?   So why is it that every time I see the word Asset in connection with this current economic crisis, they are talking about financial products that are nothing more then packaged debt.  Apparently, we should all be hoping and praying that the "private sector" will be enticed to eventually buy back these bundled "assets"  which are really bad loans (that they issued in the first place) as long as the gov't first buys them up and holds them long enough for them to obtain some kind of magical allure. Long enough for them to be of some value to somebody!  If it wasn't so sad it would be funny.  Am I understanding correctly?  Is it the case that all the orignal bail out money was used by the banks to pay out dividends and keep their stocks viable because they have nothing of worth at all in their coffers?  All their assets are red, it is ALL DEBT! Do our higher institutions of capitalism have no capital??!!   Where did  the wealth of the nation go? 

 My daughter had to bob and weave to avoid the credit cards they were throwing at her on admission day at college .  The child had no job!  The same people who the credit industry have been granting all this credit to for DECADES, the Consumers of Our Vaulted Consumer Economy,  have not have seen their real incomes increase since the G Damned 70's! I betcha anything that Oprah and that lesbian financial woman had a lot to do with the rug being pulled out from under these Wall St. clowns.  They were each on a campaign to get the housewives of America to pay down their debt, stop buying, and get off the crazy train. So, let's say, people listened to them  and imagine if the majority of household's balances were, indeed, paid down, therefore the fees and interest penalties paid to the banks decreased.  So, greatly decreased revenue for the bank occurs at the same time that the remaining "assets" left in these bank's books are mainly bad mortgages from sub prime loan walk aways and bad credit debt from defaults on credit card balances swollen from high interest and penalties.  Show over, Mr. Titan of Finance, grab your stuff and hit the exits.  No?

The Princes of Capitalism charged exhorbitant interest rates and traded these assets of doom back and forth, up and out, to each other and the world, patting each other on the back for their ingenuity as they cashed their bonus checks.  The whole house of credit cards is one big huge scam. Let's hope our debit cards hold out, but don't count on it.  Our only native export is finance, and it is a huge game of three card monty.  Always has been.  We are so s*c*r*e*w*e*d! 

LilAnnie LilAnnie
56-60, F
28 Responses Feb 13, 2009

I won't say that he was set up, only that it's quite the act to follow. I like what Bill Maher said the other night when asked about Obama coming into office after W... he said it's like being a hotel maid after a week long stay by Led Zeppelin.

Whatup, It's like he was set up. You know? Let's fix it so it all topples just as we leave, we'll take the money and run, and let that damn socialist clean up after our party. I try not to hate, but it ain't easy. It helps when I put a human face on all those thousands of people, getting on the trains, going to work at the banks. They weren't to blame, just the Titans! The Masters of the Universe! The schmucks!

They have no shame at all! Really! To use the bailout money in such a way, to enrich themselves, for pandering luxuries! The gall of the act! It scares me to think that they did this in broad daylight, for everybody to see. What have they done behind closed doors!!!!!!!!!

Oh I don't hate them but I think their actions should place them somewhere that they can sit and think about how much they have become hated by many in this nation.<br />
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Yes I think they should be sent away and their loans be taken back from them.<br />
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In my opinion they have stolen from the American tax payer.

I can't hate them, Blue. It would be easier if I could. People I love in my family and many friends and neighbors all made their livings on Wall St. I was always the hold out. Dug in my heels and made the conscious decision years ago to remain working class. A true blue lefty. I felt righteous about it actually. I was a jerk. They would get mad at me, cause sometimes I would let it slip that I thought they had traded in their ethics for security. But really, The USSR had toppled, Capitalism had won, big minds were proclaiming the end of history, even! If a profit could be made, then it must be a good deal, right? The free market was freedom personified. It had to end, it was all too extreme. People are afraid Obama will bring socialism. I don't know what we should call it, maybe capitalism light?

We had a nice discussion regarding the bailout on this thread, you can check it out if you want:<br />
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<a href="http://www.experienceproject.com/uw.php?e=451980&n=20" target="ep_blank">http://www.experienceproject.com/uw.php?e...</a>#comment_em<x>bed<br />
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We won't be funding any more billion dollar bonuses for execs that come begging for money. The bill also caps the salary for CEO's who accept money at $500,000 (which is $100,000 more than Obama's salary). <br />
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If you've been paying attention the last few months, you would see that there's a clear difference between this administration and the last one. <br />
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The original $700B was split into two parts. Bush and Paulson doled out $350B to a handful of big banks, without requirements on what the banks would do with it. Instead of using the infusion of cash to free up credit markets, the banks used that money for acquisitions. They bought up other banks and consolidated. They did squat to deal with the credit market. That is why the CEOs of 8 major banks were getting grilled by congress the other day. People are pissed, and rightly so. <br />
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Paulson first came forward with his 3 page proposal (LOL!) which actually had the ball$ to say that after the money is spent, no one would have the ability to question the way it got spent. Congress managed to shape this package a little bit, but there was nowhere near enough oversight on what the money was going to do once the banks got it. <br />
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The original intent of the money was to buy up the troubled mortgage assets. After the money was handed over, Paulson changed his mind and said they decided to go a different direction. They started purchasing stock and infusing money directly to the banks, which they then used to buy up smaller banks. Nothing to do with the credit market, so we were no better off. <br />
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Now Obama is set to spend the other $350B and people are pissed. They should be, but not at him. Blame Bush and Paulson for paying off their friends at Goldman Sachs and other big a$$ banks that took the taxpayer funds, paid themselves $18 B in BONUSES and left the credit market and troubled assets to rot. <br />
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This is what has happened. And now Obama is facing stiff resistance because of George's parting gift of a middle finger to the American people.

I wish I could write checks that my account couldn't support.<br />
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Wonder what would happen if I did that?<br />
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Oh but I forgot,,,, We the tax payers will make this all good right?<br />
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Isn't it great that we are funding the billion dollar bonuses for these ^%&*%#$&#@$@#^@$%&$%&*

Whatup, I'm going to watch it right now. I don't know if I'll be able to watch it all at one go, but I will see it all eventually. It sounds like a much see video.

Like I mentioned before, in order to understand the enormity of our economic problem go to Youtube or google video and watch the 47 minute movie "Money as Debt". It's an animated movie that explains why our economy is built on a system of debt that is impossible to escape without changing the entire system. (I have just posted this video on my blog)<br />
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In a way it's kind of scary and depressing, but I think it's always better to know the truth, no matter how uncomfortable it is. If you cannot understand the problem, how can you ever hope to overcome it?

Stillsleeping, I'm old enough by far to remember the days when credit cards were very very rare. We were a total cash economy. If you didn't have the cash in your pocket, you couldn't afford to buy it and didn't. People saved their credit card for big emergency purchases, like replacement furnaces or washing machines. <br />
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If we stop our reliance on debt, which I think we should, our addictions to electronic products are going to take a big hit. Unless society realizes that the common man needs a substantial raise to actually afford all these expensive toys, phones, cameras, computers, video games, etc.

Here's excerpt from one of his recent articles:<br />
http://www.financialsense.com/fsu/editorials/schiff/2009/0116.html<br />
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In truth, not all economies run on credit. But over the last decade, the United States became a bubble economy that needed unlimited credit to keep from collapsing. In a legitimate economy, it is not credit that fuels spending and investment, but simply income and savings. It's too bad our Fed chairman does not understand the difference.<br />
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That American families now routinely rely on credit to make every-day purchases is a habit that needs to be broken and not encouraged. What we need in America is more restraint and less indulgence. For example, Americans in the current economy should not go into debt to buy new cars. Given the level of debt that weighs down the typical family, Americans should defer such purchases until they have paid down existing debt, or replenished their savings to the point where they can afford to pay cash. Until that time, Americans should continue driving their old cars. In the meantime, the untapped savings could be made available to local businesses that would use it to finance badly needed capital investments.

Peter Schiff has been talking about this problem for years. Check out some his youtube videos.

Well I think you proved you don't need a degree to have common sense.

lilannie, there are many forms of intelligence and common sense is one of them, so is a sense of the truth<br />
there are many learned people who have neither<br />
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you are so right at what you say...i am buying my home..but im not in trouble cos i never purchase anything on credit ..i buy when i have the money<br />
ive never had a credit card <br />
i live the simple life....the smartest way to live<br />
cheers

Chess and mathematics are but types of intelligence. That's like saying there's only one way to be beautiful :)

Thanks, Sara. I better keep trying to "sound" that way. It can't hurt!

You did, Sunny. A posted the same story in two different groups! Ha, long story of no consequence but thank you again anyway! but I am not smart. You know why I know that? Because I lose almost every game of chess I play and that is a pretty good indicator of intelligence. But I am awake and I am interested. Hope to be as long as I breathe! LOL!

You sound smart to me, LilAnnie!

I believe that, that the money never existed. But a lot of people got stinkin rich in the last few decades. there might not have been money but there was an awful lot of wealth. People accumulated something of value. Was it all smoke and mirrors? Like Madoff's ponzie scheme?

Newspapers are being hit hard by the economy. They were already struggling because of the internet. Most people get their news from the internet these days, so it's not unfeasible that we might not have newspapers in a few decades. As for why it's slimmer, its because of loss of ad revenue and loss of jobs. They are tightening their belts. <br />
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An interesting video you can watch for free online is "Money as Debt". The reason so much money could be lost is that it never existed in the first place.

Challenges is the word! Its all of it coming to a head at the same time, as we're having a changing of the guard. At the risk of seeming paranoid, I'd say almost by design. We are definitely slamming the brakes on the whole kit and kaboodle and either turning in another direction or being taken for a ride. I think we need to keep our eyes wide open and our ears peeled for whispers.<br />
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What bothers me the most? Our media companies are so consolidated, there are no very smart people investigating and pointing things out to us!!!! Another paranoid observation, my daily newspaper is a third of the size it was just three weeks ago. What's up with that?

Our entire financial system is a house of cards. Speaking of which, there was just a documentary on cnbc last night called "House of Cards". It explained how the sub-prime mortgages infected our system, and how it's lead to the current credit freeze. The latest development is that the credit card companies are now overstocked with bad debt, much like the mortgage sector, so the circus is still in town and isn't leaving anytime soon. <br />
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I already understood much of what that documentary had to say since I worked in the mortgage sector during the boom ago and for the last few years have been doing indirect lending at an RV dealership. <br />
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Make no mistake about it, this is a severe crisis that is going to take years to climb out of. Even after we do, we'll have to deal with the inflation that we're incurring at the moment. No president since FDR has entered office under such enormous challenges.

Anyway, false alarm, the story is back in the other group but I'm leaving both stories up. I hope there is some kind of discussion in both groups about the same subject. Wouldn't that be interesting! to see the different takes on it! Oh, I hope so.

Most bus drivers got it goin on! Need to be tested and retested. We are outstanding non-criminals! Fingerprinted every two years. I can never rob a bank. And sober! We are drug and alcohol tested randomly. But I am definitely not one of the smart ones. I am dense in many ways. Trust me on that. But I am interested in stuff. I'll give myself that much.

It's an excellent post, Annie.<br />
Who knew bus drivers were so smart.

I posted this story in the hate Obama group. Hoping they could see things in a less partisan way and wondering how they think about this whole banking problem. It got flagged. So here it is for less fearful people to look at, if you'd like.

:O

; - )