Monday, September 29, 2008

The Government Bailout

I'm relieved to read today that the bailout has failed today and I hope it continues to fail. I'm disappoitned that the votes to reject it came mainly from republicans rather than democrats. It merely furthers my belief that as long the two parties remain as it is there is no real long term solutions to all the problems that exist in America.

It's disappointing that if there is a 700 billion dollars that the government would give it directly to the people in terms of direct loans. Similarly to those given to students in colleges to help with liquidity. In as far as I see, the credit "crisis" (a misuse of the term here) relates to giving out loans that are unnecessary. For example recently it was on the news that McDonalds was denied a loan to update their coffee machines. That just seemed hilarious that you need a loan to do that and than on the local news this well to do woman needed a second mortage even though she has enough assets to borrow gets denied.

These are all signs that a bank is doing their JOB! 700 Billion is nothing compared to the amount that people in America have in debt. Living paycheck to paycheck is horrible which is why you should never borrow money when you are in that situation cause there is almost no chance you can pay it back. People buying houses they can't afford and the worst culprits of the housing market are brokers and agents to convince people to buy overpriced buildings. You just have no idea how horrible it is in new york when wooden houses in brooklyn for 1/2 family can go for half a million. Tottally absurd.

It's going to be tough but it's better in the long term if credit remains more difficult to get and the debts people owe to be paid off. That's what I believe anyway. Only time can tell how bad it gets but 700 billion would probably only give stability for another 5-10 years? People still playing with the books and we end up with the same problems. The tech bubble was worst in my opinion.

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