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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] How the Bear Stearns Bailout Saved You, the Little Guy Posted by CC in OC on July 13, 2008 at 2:11 AM In Reply to: Re: FORECLOSURE RELIEF BILL BECOMES LAW posted by hard money lender on July 11, 2008 at 9:08 PM ** the govt is forever trying to protect people from themselves. ** I can understand why you're upset. You want your money! Perfectly understandable, but surely you're aware of the oft-quoted comment by John Maynard Keynes: "If you owe your bank a hundred pounds, you have a problem. But if you owe your bank a million pounds, the bank has a problem." --as quoted in The Economist (2/13/82, p. 11). Now, multiply this by millions of homeowners who collectively owe "the bank" and you begin to see the enormity of the "problem." It's not enough to say, "What a bunch of socialistic crap." Our financial system is in need of extreme unction--just as it was during the Great Depression. People sometimes don't grasp what would happen if government didn't step in, however inartfully, to staunch the flow of blood. Much criticism was leveled at the government's intervention in the bailout of Bear Stearns. But had they not intervened, we would be in a worse mess. While this article by John Mauldin doesn’t give the blow by blow details, it does give some great insight into the situation, and what could have happened if the bailout had not taken place. http://tinyurl.com/6fdb9s The government may or may not step in where Fannie/Freddie are concerned. It wouldn't surprise me if they did, and it wouldn't surprise me if they didn't. If the GSEs need to be fixed, now's the time to fix 'em. But if the feedback--the entire world will chime in about this--is that intervention is needed, then government is doing what government does: keep the entire country from imploding, albeit they were asleep at the switch by giving the GSEs far too much latitude. That situation will be corrected. Follow Ups: i wont try to explain to you why large govt is bad hard money lender 7:43 AM, 07/13/08 (3) I'm a registered Republican... CC in OC 10:07 AM, 07/13/08 (2) Re: I'm a registered Republican... Daniel D 4:24 PM, 07/13/08 (0) Re: I'm a registered Republican... hard money lender 11:05 AM, 07/13/08 (0) Post a Followup: Name : E-Mail : Subject : Comments: : ** the govt is forever trying to protect people from themselves. ** : I can understand why you're upset. You want your money! Perfectly understandable, but surely you're aware of the oft-quoted comment by John Maynard Keynes: "If you owe your bank a hundred pounds, you have a problem. But if you owe your bank a million pounds, the bank has a problem." --as quoted in The Economist (2/13/82, p. 11). : Now, multiply this by millions of homeowners who collectively owe "the bank" and you begin to see the enormity of the "problem." It's not enough to say, "What a bunch of socialistic crap." Our financial system is in need of extreme unction--just as it was during the Great Depression. People sometimes don't grasp what would happen if government didn't step in, however inartfully, to staunch the flow of blood. Much criticism was leveled at the government's intervention in the bailout of Bear Stearns. But had they not intervened, we would be in a worse mess. While this article by John Mauldin doesn’t give the blow by blow details, it does give some great insight into the situation, and what could have happened if the bailout had not taken place. : http://tinyurl.com/6fdb9s : The government may or may not step in where Fannie/Freddie are concerned. It wouldn't surprise me if they did, and it wouldn't surprise me if they didn't. If the GSEs need to be fixed, now's the time to fix 'em. But if the feedback--the entire world will chime in about this--is that intervention is needed, then government is doing what government does: keep the entire country from imploding, albeit they were asleep at the switch by giving the GSEs far too much latitude. That situation will be corrected. [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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