Bailout Plan Open Thread
The Senate is voting on the bailout as this posts -- and it likely goes to the House on Friday.
Enough ornamentation has been added that passage is more likely this time around.
Well, what do y'all think about this new bill? What does it look like? Is it improved at all? What was added? What was subtracted?
(UPDATE: The SEC extended the short selling ban until three days after the $850 billion financial rescue legislation is enacted into law. It won't extend beyond 11:59 p.m. on Oct. 17.)
This is an open thread, so have a field day.
~~~
What say ye?
Wednesday, October 01, 2008 | 08:00 PM | Permalink
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It may not be the best approach - but it is the one that must be approved. We do not need to have millions in bread lines because of philosophical differences.
Posted by: bsneath | Oct 1, 2008 8:06:18 PM
What do I think? I think it's bulls**t. My favorite part is this (h/t CalculatedRisk):
SEC. 503. EXEMPTION FROM EXCISE TAX FOR CERTAIN WOODEN ARROWS DESIGNED FOR USE BY CHILDREN.
(a) IN GENERAL.—Paragraph (2) of section 4161(b) is amended by redesignating subparagraph (B) as sub301 paragraph (C) and by inserting after subparagraph (A) the following new subparagraph:
‘‘(B) EXEMPTION FOR CERTAIN WOODEN ARROW SHAFTS.—Subparagraph (A) shall not apply to any shaft consisting of all natural wood with no laminations or artificial means of enhancing the spine of such shaft (whether sold separately or incorporated as part of a finished or unfinished product) of a type used in the manufacture of any arrow which after its assembly—
‘‘(i) measures 5⁄16 of an inch or less in diameter, and
‘‘(ii) is not suitable for use with a bow described in paragraph (1)(A).’’.
(b) EFFECTIVE DATE.—The amendments made by this section shall apply to shafts first sold after the date of enactment of this Act.
Posted by: just some guy | Oct 1, 2008 8:06:23 PM
The bill is a monstrosity: Throw it out and vote in the Swedish plan; if you're going to socialize an industry then do it right for chrissakes!
Can't do capitalism, can't do socialism, this is worse than watching a baby try to walk.
Posted by: RW | Oct 1, 2008 8:07:00 PM
It's a shame none of the Senators have any clue about economics.
The people that wont be able to get loans if this doesn't pass shouldn't be able to get loans in the first place.
I think most Americans would choose to suffer a little more than pass this bailout bill.
Posted by: Owner Earnings | Oct 1, 2008 8:10:23 PM
How does this bill make break lines less likely? Does it buy bread and give it to those that need bread? Hardly.
In fact, it ensures there will be no money left for bread when we need it most.
Haven't we learned not to trust these fearmongers?
Posted by: SFHawkguy | Oct 1, 2008 8:12:06 PM
Sessions and Shelby of Alabama have both expressed their resistance to the Senate bill.
It's a bad omen for the bill. I'd have to say the 1st quarter score is not looking good for the bill.
That would mean that Asia and Europe eat shit tonight.
Posted by: Eclectic | Oct 1, 2008 8:12:19 PM
The analogy I would suggest is that we are not just a country but a planet addicted to and binging on credit, the health of the economy is severely compromised by toxic credit poisoning, our credit supply has gotten very tight and has dried up, and we're currently experiencing the first twinges of withdrawal. The real threat to the economy, as is being pointed out by some news sources, is not stocks and treasuries but credit; it's not about where the Dow is, but where the LIBOR is. We can either choose to go cold-turkey and see a relatively short, more painful purging of the toxic credit (ie de-leveraging) or we can limp along on methadone (bail-out) with the hope that we can get back to a level of addiction that is sustainable. This is going to hurt, so the question is how do you want it to hurt, and how healthy do you want to be in the end. In the long run, we need to return to a world economy that has a healthy, sensible balance of savings and credit, one where individuals, companies, and countries live within their means.
In my mind the best (but difficult) solution is somewhere in the middle, ie a little methadone for a little while to ease the pain, but a clear focus on making sure we get the monkey off our backs. The current legislation is just what you would expect from a junkie – it barely acknowledges the need to get the monkey off our backs. It mostly wants to just stop the shakes, and hope that things go back to the way they were after a bit. And Dr. Paulson has made a point of reminding us how much withdrawal sucks, and has put a $700b therapy plan with relatively vague details on how or even if it will work in front of taxpayers to sign off on with little more than a verbal "don't worry, I'll take care of it" assurance. The oversight and accountability of the Sec. of the Treasury in the legislation is just not sufficient. The controls on valuing assets is a denial of reality. I am for a plan, but not this plan. I want to see a plan that acknowledges the need for fundamental change in our financial culture and behavior, from banks to businesses to individuals.
Posted by: GreggT | Oct 1, 2008 8:13:20 PM
People in breadlines? Just wait. This is like throwing dry tinder on a forest fire, you'll see a politically useful brief drop in flame height - and then a certain absolute destruction of the forest.
Printing MORE $, adding MORE debt to the fire is certain to only make the end result even worse.
We deserve what we have coming at this point.
Posted by: Susan | Oct 1, 2008 8:15:53 PM
Why waste your time. No one is listening. The Great American Giveaway (GAG) now includes even more gifts for almost everyone in business or finance. Earmarks, sham FDIC insurance, tax breaks for all (unfunded), etc. The original piece of toxic legislation remains intact. Absolutely unbelievable! The Morons now rule the asylum.
The only chance left is for the House to do the right thing....just about the last thing for which Americans should hold out any hope at this point. Bush & Friends 1, Americans 0. I give up...watching baseball now.
Posted by: Chief Elf | Oct 1, 2008 8:16:06 PM
This is a sick joke right, an improvement??? Disgusting.
From http://senateconservatives.com/2008/10/01/using-panic-to-pass-pork/
Here are some of the special-interest provisions that are now part of the Wall Street bailout legislation. The bill started at 3 pages, grew to 106 pages, and is now 451 pages.
Film and Television Productions (Sec. 502)
Wooden Arrows designed for use by children (Sec. 503)
6 page package of earmarks for litigants in the 1989 Exxon Valdez incident, Alaska (Sec. 504)
Virgin Island and Puerto Rican Rum (Section 308)
American Samoa (Sec. 309)
Mine Rescue Teams (Sec. 310)
Mine Safety Equipment (Sec. 311)
Domestic Production Activities in Puerto Rico (Sec. 312)
Indian Tribes (Sec. 314, 315)
Railroads (Sec. 316)
Auto Racing Tracks (317)
District of Columbia (Sec. 322)
Wool Research (Sec. 325)
Posted by: f_these_clowns | Oct 1, 2008 8:16:25 PM
Can someone please explain why "the clock is ticking" on passage of a bill? Will the world come to an end if this is not passed by COB on Friday? If Congress raises the FDIC insured level to $250,000 and backstops all money market funds what exactly is the short term emergency? So a few more bad banks run by overpaid stoneheads go under, so what? The real crisis is not on Wall Street, it's on Main Street, where people can't afford overpriced homes, can't afford health insurance, can't afford college, and increasingly can't afford food and gas. Sounds like a crisis to me, but try telling that to the millionaire fat asses in the White House, on the Hill, and on Main Street. So, again, what exactly does this freakin' has-to-be-passed-right-now-or-the-world-will-come-to-an-end bill do to help the average person?
Posted by: Mitchn | Oct 1, 2008 8:19:35 PM
I am disgusted to see this pass. It literally churns my gut! This is an impossible problem that won't be solved with USA as a backstop to the world. We are American and our leaders can't step up to fess up that we are headed to an awful time and we will bailout Fraud Street and the World and screw the Taxpayer first! A disgrace!
I don't like the arrow's passing with this Sh!t either!
Posted by: Elvis | Oct 1, 2008 8:20:12 PM
I don't understand how a democracy can have such a strong public sentiment/position and their respective representatives still try to figure out a way to pass it. They've slammed this thing full of information in an attempt to overwhelm anyone responsible enough to look at it. Now they go through the Senate (notoriously more insulated from public opinion), then they will squeeze the poor bastards in the house into voting for it... It's gonna pass, I don't think anyone in conrgress has the balls to stand up to the peer pressure. This is a shamocracy.
Posted by: lauteus | Oct 1, 2008 8:22:10 PM
"Senators attached a provision repealing a 39-cent excise tax on wooden arrows designed for children to an historic $700 billion bank rescue that is likely to pass tonight. The provision, originally proposed by Oregon senators Ron Wyden and Gordon Smith, will save manufacturers such as Rose City Archery in Myrtle Point, Oregon, about $200,000 a year."
Oh, for the love of Xenu...
Posted by: Dr. Kenneth Noisewater | Oct 1, 2008 8:22:57 PM
My bad. Should have been "...and on Wall Street."
Posted by: Mitchn | Oct 1, 2008 8:23:03 PM
Save this question, Barry. You will be reusing it several more times in the next few years. This crisis is far from over. No matter what.
Posted by: Robert | Oct 1, 2008 8:23:25 PM
The bailout bill blows. Watershed moment in the destruction of liberty. If the "crisis" is so damn important, why do they have to load it up with pork and mandates?
The only upside is that a lot of Americans of all political persuasions just may have got a clue as to what is going on, and who holds the real power.
Posted by: Automated Robot | Oct 1, 2008 8:24:14 PM
worthwhile Ornaments hung on the same Dead Christmas Tree.
as I was telling my Rep.
Past that, Susan has it Right.
People better forget about Finance, and start Thinking about Economics. Remember, the Field is, more properly, Political Economy.
It isn't that our fortunes are at stake, our Fortunes are at stake.
http://www.yourdictionary.com/fortune
Posted by: Mark E Hoffer | Oct 1, 2008 8:25:12 PM
The problem's size is not $700 Billion, it's $180 TRILLION. On Monday these idiots destroyed 1.3 TRILLION dollars of value in fiddling with a "fix" of half that amount...
Why hasn't anyone blamed the Federal Reserve? this is where it all started, when Greenspan's madness was combined with power.
Posted by: Daytona Beach News | Oct 1, 2008 8:25:49 PM
Hey, I'm all for it because of the deal made by the Democrats to stop the Iraq War in exchange for this bailout.....what's that???....there wasn't a deal???....but didn't we put the Democrats in power in 2006 to stop the war???....Didn't Pelosi and Reid say that's what they would do???...
Well, that's O.K., because at least the impeachment will go on....what's that???...Pelosi said WHAT?!?!?
Well, I understand SORT OF, because at least we can still investigate the criminal actions of the phone companies going along with the illegal wiretaps ordered by the President....I'm sorry...say again....THEY DID WHAT?!?!?!?
And now this.....no strings attached....
O.K., this is a joke, right. Where's the camera? Where's Alan Funt? Candid Camera, right....right?????
Posted by: Winston Munn | Oct 1, 2008 8:25:49 PM
I got this email this afternoon:
It's two of the best together!
ALERT
The Credit Crisis: How We Got Into the Current Mess and How We Can Get Out
Risk Metrics Group and Roubini Global Economics cordially invite you to join a LIVE web conference on Thursday, October 2nd, 2008, from 5:00 to 6:00 pm EST.
Nouriel Roubini, Chairman of RGE Monitor, and Barry Ritholtz, CEO and Director of Equity Research of Fusion IQ, will discuss the current financial crisis, followed by Q&A.
We anticipate very high demand for this web conference and space is limited. Please register as soon as possible.
To register for this meeting:
1. Go to https://communique.webex.com/communique/j.php?ED=109114167&RG=1
2. Click on the button to REGISTER
3. Register for the meeting
RGE Monitor is a leading economic research and analysis firm based in New York. To learn more about RGE Monitor, please visit www.rgemonitor.com.
Fusion IQ is a quantitative research firm in NY. Barry Ritholtz is the creator of the Big Picture, one of the web's most popular financial/economic blogs.
Posted by: KJ Foehr | Oct 1, 2008 8:28:53 PM
This little piggy went to market ... and bought some votes from nervous politicians.
This bill has been filled with enough pork to satisfy even the most porky politician. Where are Ted Stevens and Robert Byrd? And nobody, absolutely nobody has had time to read it all.
QU: What do $3 bill. in mental health coverages have to do with the credit crisis?
A: We will all be in counseling and on Prozac before this is over. Congress will ensure that my health plan will pay the claim.
Kill this evil beast now.
I'm a taxpayer who has generally given Bush the benefit of the doubt, but I am having trouble pulling the knife out of my back.
Posted by: Scott in S.C. | Oct 1, 2008 8:28:57 PM
Stop the breadlines?? Ha Ha, right! Maybe if your a banker,..you won't have to stand in a breadline....with this bill.
Socialism here we come. Amero here we come.
All I know is I'm not voting for anybody who votes for this.
Posted by: Ken H. | Oct 1, 2008 8:29:53 PM
You would think, with forums like this - allowing the uncensored exchange of ideas and coordination of resources - we could mount a physical presence in Washington to oppose this dumbass, piece of shit Bill.
Im ready and willing (albeit, probably closer than most), but demonstrating seems declasse.
The revolution won't be televised - it will be commented on in blogs.
Posted by: Marcus Aurelius | Oct 1, 2008 8:34:06 PM
We could pay for this by harnessing the electricity generated by the spinning graves of our founding fathers, now in high rotation.
Problem solved.
Posted by: John W | Oct 1, 2008 8:34:42 PM
