Does Anyone feel like Bailing

[tw]

Originally Posted by Bullitt

Professor of mine today mentioned today that we should watch to see what the hedge funds do tomorrow as a serious indicator of further trouble.

Economic disaster averted during the Long Term Capital Management fiasco may have scared commercial banks sufficiently to demand honest fiscal practices from the hedge funds. Bank of America, JP Morgan, and Citigroup were three suspected at risk if hedge funds default. These three currently appear to be the most stable.

Almost one year ago, riskiest equities were identified. Take a gander at eight pages of posts in Sub-prime Bail Out in the first week of November 2007. Listed as problems were companies even in the last (109th) post. What is ongoing today was an obvious and serious problem almost one year ago.

Or again in March 2008 Housing Crisis in Australia .

In Sept 2006, a "Family Income" chart demonstrated one symptom that predicted today's financial meltdown: Has the Bush Doctrine failed?

What is next likely to be harmed by credit market seizures? Hedge funds must be under pressure since the funds are unlikely to have hedged for losses this large and are very dependent on access to credit.

Crash of Wachovia and Washington Mutual occurred so quick without warning. Therefore others are probably as unstable. Furthermore, foreigners are not marching in mass numbers to buy up so many 'discounted' American firms. That implies equity markets must fall further.

Too much accounting has been in the tradition of Enron and Arthur Andersen. Anyone can only assume that other unstable WaMus and Wachovias are out there. Commerce Bank has also been on my suspect list. Major regional banks may next be in line for collapse.

How serious is the problem? If credit markets seize only because the government does not provide $700billion, then capital losses are probably even worse.

What happens next? World financial markets are suddenly surprised by how much America must buy from the world. Therefore America must sell debt at even higher costs to America. Where does the US government get $700billion? If none from Americans, then where? We have yet to see shock when America sells an additional $700billion debt onto world financial markets that will then demand even higher interest rates on a riskier American economy. After all, who wants to buy debt in dollars that will only fall in value?

Why the bailout? Because the only remaining American institution with sufficient credibility to borrow that much from foreigners is the US government.

Who kept saying, "The fundamentals of our economy are sound"? Even the spread sheets are now exposing how 'sound' this economy has been.

[Undertoad]

Originally Posted by tw

Commerce Bank has also been on my suspect list.

There is no Commerce Bank. It's just a brand name now. It was bought by Canadian TD Bank last year.

[classicman]

Originally Posted by tw

Who kept saying, "The fundamentals of our economy are sound"? Even the spread sheets are now exposing how 'sound' this economy has been.

All the democrats were for years when it was time for some foresighted leadership. This administration certainly didn't make things better,not by a long shot, but to lay this at the foot of this idiot is unfair and untrue. This whole mess started when Clinton was in office and the lenders had quotas to reach on "affordable" housing.

[Griff]

Originally Posted by classicman

This whole mess started when Clinton was in office and the lenders had quotas to reach on "affordable" housing.

That is one thread. There is also deregulation without transparency, enormous deficit spending, desperation, and criminality. Some hedge fund numbers come out today supposedly the same smarties who created a lot of these bullshit portfolios moved to hedge funds when things started getting shakey.

[Stormieweather]

Originally Posted by tw

~snip~

Crash of Wachovia and Washington Mutual occurred so quick without warning. Therefore others are probably as unstable. ~snip~

I heard rumors about Wachovia months ago and pulled my client's money out. I don't think it was exactly without warning....

But I do agree, there are other banking institutions in trouble. And things will get worse, before they get better.

Stormie

[xoxoxoBruce]

Originally Posted by Stormieweather

But I do agree, there are other banking institutions in trouble.

I heard 114 banks.

[SamIam]

I just skimmed all 7 pages of this, so forgive me if I'm repeating anything that was written previously. Maybe the government does have to step in and bail the bastards out, but I soooo agree with Brianna's "off with their heads" policy. The CEO's of these outfits are criminals and should be treated as such. Supposedly, they are paid the big bucks because they have the intelligence and knowledge to run a major corporation. They've run them alright, straight into the ground. I'm wary of government meddling, but this fiasco shows me that someone needs to start importing pit bulls into the offices of the presidents and CEO's of our financial institutions.

My small town used to have two banks. Then overnight, one of the two flapped its wings and vanished off into the darkness. Suddenly, every third or fourth house around here is for sale. The local pharmacy went out of business along with several shops on Main Street. I think we're in for a long, hard winter.

[xoxoxoBruce]

America's #1 export = DEBT.