We are facing the most complicated financial crisis in recent years, yet something far worse is going on. We are hearing sound bytes that tap into our fears, but not the substance of intellect. We need to read about this crisis to understand and we need to suspend judgement until we are certain we understand. But the ones who are tampering with our rights know this isn’t happening–and so we are facing the maverick intervention of McCain–who in John Wayne style–will make his followers feel that he is in control, when just recently he admitted that he didn’t understand our econcomy.

Move Jon Stewart and Stephen Colbert to prime time on CNN. Move Dobbs and Blitzer to the 11pm spot on Comedy Central. It will be a fair swap.

McCain is cowering behind the financial crisis, afraid to go to the debate because he knows he’ll have to defend himself against an entire career of making deregulation of corporations his central focus. No way he’ll show up tonight… instead he’ll try to postpone the debate, hoping some of the focus over the economic crisis will fade before he has to go before hundreds of millions worldwide and defend his senate career.

I’m sad to agree with Beverly. There is supposed to be a debate this evening, an important one. Because the economy is not a strength of McCain’s, he undoubtedly does not want to debate in the middle of an economic crisis. So he changes plans. He can manipulate enough to appear as though it is he who is solving the problem while at the same time throwing the negotiations off to insure that there will be no compromise today. McCain could fly down to Mississippi just fro the debate and return to Washington, but that’s not likely. He has another reason for delaying tonight’s debate: increasing the likelihood that the VP debate, scheduled for next week, will also be postponed. That is likely to be another intentional manipulation by McCain’s camp because Sarah Palin is impressively unprepared.

It is so sad that all McCain inspires is pure cynicism.

I’m an independent and have voted Dems all alone based on ideals and not my wallet. This time my vote will be based on my wallet and it will be rep. so I can keep a few more bread crumbs. I don’t care who is living in the W. House and Cap. Hill because they are ALL driven by rich and powerful. The only thing they know best is to blame others.
As to the bail out, the proposed bail out plan is on the wrong track, the plan should look like what Warren Buffet did to Goldman Sachs (taxpayers pay cash, taxpayers get preferred shares w/ interest and warrants) This way the ones that wanted to be saved will be saved the risk and reward will be more evenly distributed.
As to our wars, whether we supported them at the beginning is not important (I supported Agfhan but not Iraq). What we need is leadership to bring them to an orderly closure - not just pull the plugs and out. This is no diff from our bail out discussion. At this time we should focus on orderly closure. After Nov 2nd, we can start learning the lessons.
Respectfully yours.

A fitting end for a failed Presidency and the ideology of the right: President Bush and the conservative movement’s Little Big Horn where hands-off regulation and certainty about free markets led them blindly into their worst nightmare: socialization of economic institutions. The final nail in the coffin is President Bush’s failure to lead his own party to a successful resolution of the crisis of their own creation. Still want to sit down and have a beer with this guy? It may be the only thing he does successfully!

This week has shown the Constituion at work. The Framers made the House of Rpresentatioves face reelction every two years just for this purpose, that they be more accountable to the feelings and needs of their voters. The Senate is meant to be more deliberative and less responsive to the political whims of the public and to have more stabilty in the make-up of the body.

We need to appreciate that the Constitution is working on behalf of the citizens.

” Still want to sit down and have a beer with this guy?” LOL! Peter, I love that!

I’m really torn here because I don’t like this bailout at all - it’s too hasty to consider whether it will work or what its consequences might be; everyone is “thinking” about it in a state of panic and no one has a clue how we will pay the $700B (+ interest!) bill - or even whether $700B is enough! And no alternatives (of which there are many) have been given serious consideration.

So the Republicans, who are blocking it, might turn out to be the heroes! “Republican heroes” is not a concept that trips off my tongue easily but they have a real chance here to do something good if they don’t screw it up.

A perspective from an American living abroad about abuse of financial system and public finances http://www.fsfinalword.com: “… include widespread crony capitalism that at times reeks of criminal capitalism; excessive government borrowing, spending and waste; and a lack of responsible leadership that has led to pervasive mistrust. George Bush said that the market isn’t functioning properly, but in fact the market is functioning exactly as it should given the abuses by the participants. A shock-and-awe bailout plan can postpone the equilibrium process, but not avoid it. …” In my opinion this, financial market “self-correction”, is something that should have happened a long time ago, in 02 perhaps. Wounds of the market were instead “heavily dusted” with taxpayers money and we have a wide-spread infection of the system. I think we are beyond 700-strong antibiotics. Infected bankers need to be removed from the system, not given a shot to the arm to live longer and spread out their irresponsibility. Bailout (taxpayer’s money) will only increase amount of money in the system –> increased inflation –> prices go up –> taxpayer pays again. It won’t stop!

I like Jack Beatty but he is too partisan to be an impartial commentator.

Can’t you find someone a little more netrla and not so partial to the Democratic party?

2002-2006 was a test of Republican party and their ideology when they controlled all branches of the government. That was the time to reduce spending, downsize federal bureaucracy and put the breaks on irresponsible borrowing so everybody from a consumer to investment bankers to the US Treasury live within its respective means. Did not happen. To echo Peter Nelson above, perhaps they could redeem themselves now by stopping this bailout in its proposed form. In the process they may derail the campaign of their own candidate. I will almost forgive them.

Jack Beatty is one of the Great Enlightened Voices of the media world, and one of the best reasons to tune in to On Point. Not only does Tom always balance his guests in terms of perspective, but Tom himself always goes to extremes to play Devil’s Advocate… sometimes to my frustrated consternation.

I smell a rat. John McCain rides into town, falls off his horse, gets trampled. Then, miraculously, he rises up, marshalls his forces (the recalcitrant republicans) brokers a deal, the thing passes, Wall St gets its trillion dollars, the market rallies, McCain climbs aboard the Straight Talk express private jet, flies to Atlanta and kicks ass in a nationaly telivised debate. Tonight.

Where will the $700 billion come from? Uncle Sam is already running a big tab. Will the Chinese agree to fund the bailout? The Arabs? Who?

We,unfortunately, need to rescue the system for both the private and public sectors. Private citizen’s will be even more upset when the gov. has to underwrite bonds at an intrest rate of 10%… this is a real possibility. On the other hand the most direct beneficiary is the american corporation, the indirect is the public. I agree that we need oversight, etc. but more importantly is the concept of “faith”… right now we are talking about lending the funds with “faith” that they will be repayed over time. On the other hand why can’t we increase the corporate income tax by 5% over the course of two years in order to ensure repayment of the public loan/grant?

Boy! Tom and Jack are excited. They’re enjoying this situation…sounds like it.

Please explain why it is important to buoy the credit market. If people can’t afford the car they want, why should we make it possible to buy it? It seems to me like credit has become America’s addiction and this bailout is the “fix”. Perhaps its time to cut ourselves off and the withdrawal will hurt. Thoughts?
Jenny
South Carolina

Does anyone think that Bush and the hold-out republicans are waiting to agree on a bail-out until McCain gets out of debating tonight? If McCain has made enough promises to the G.O.P (though it wouldn’t be very Maverick) then there might be a litte coup-de-timing going on here, and completely at the expense and risk of the entire country. Power grab at the people’s expense. Same as the war.

Does anyone care what Jack Beatty says anymore? Since he has a permanent seat at the mic, and shares his socialist rantings with us every day, shouldn’t some right-wing figure be there also, and maybe a Libertarian? Or is NPR only interested in socialist rantings?

Hi Tom and listeners…

Usual great show that’s onpoint. Your last caller Mark…maybe it’s presidential to be able to compromise which is what the Democrats and Sen. Obama are doing. They are doing the right thing…the Democrats are addressing the issues…and making changes to the Bush plan.

Tom…The republican failed programs caused this…and it would be leadership for the republicans to accept responsibility and admit they were wrong. But the party of family values is NOT putting country first.

If the economy takes a really big hit…and McBush…opps I mean McCain and Palin were to get in…well at least she could keep her eye on Russia!

Bottom line…the Democrats can and should still link McCain to Bush…because Bush was a do nothing and apparently McCain is a do nothing also.

Thanks for the show.

Why hasn’t W issued an Executive Order implementing the Paulsen Plan, minus golden parachutes, thereby relieving the Congress from its political constipation, lubricating the credit markets, and salvaging the equity markets ?

Richard Scheiber

The responsible use of credit is crucial for buisiness to operate, fund growth, and weather up and down cycles. True, personal credit is abused and excessive, but personal credit is by and large not what people are afraid of losing… loss of commercial credit is the real danger. Retail establishments, for instance, typically buy their entire inventories for the busy season (Christmas) on credit, then earn enough to pay their creditors back and ride out the rest of the year until the next busy season.
Still, the failures that will result due to this crisis are necessary, as both democracy and free enterprise will learn invaluable lessons that will ensure the ultimate health of our economy and country. We’ll have to ride out bad times regardless of this bailout going through… better to ride out bad times and get the benefit of learning a lesson from it.

What happens if McCain shows up late to tonight’s debate, potentially after Congress votes late today on a bailout bill? Is he allowed on stage? Will that help or hurt him?

Here’s some interesting math. $700 billion is approx. the combined wealth of the wealthiest 75 Americans. There are almost 1,000 billionairs. If the wealthiest 1,000 people kicked in 20% of their wealth that would more than cover $700 bill. They would have the most to gain. Patriot up!

Thanks John. You address precisely the concerns that average Americans, like me, don’t understand. I agree with you, that sometimes learning the hard way teaches us the most.

Perhaps we could look at the situation differently.

Of approximatley 10 trillion dollars of residential mortgage securities about 9% are ’sub prime’. The delinquency rate and foreclosure rate of these is higher than the other 91%, for the moment. But, this 9% is negatively effecting the liquidity of the financial markets to the extent that it will become increasingly difficult for anyone to find a mortgage to purchase a home. Therefore, by segregating these ’sub prime’ items we can do a number of things for the economy not the least of which is to be able to provide mortgage financing for legitimate and creditworthy borrowers and to slow down or even place a moratorium on ’sub prime’ foreclosurers in order to stabilize the residential real estate market which represents the largest investmentfor most folk.

Business Commentators:

Please describe a “estimated time line/chain of events’ scenario of how a collapes would transpire.

I hear vague fast generalizations of how a Wall Street collapes would (is) filter into Main Street capital markets. I find this non-factual discussion condescending.

This is emblematic of the theory that smart guys like Henry Paulson were “smarter than us.” The mystical market forces would check hubris and greed. So, we need to trust these great men to attend to our economic well-being.

The modernization of comodities futures act removed all discipline from the market. The brilliant men turned out to be evil men. And, the market proved to merely facilitate aggression and fraud.

Now we have to give these men the money we earned to save our economy. This is a sickening prospect. Now, I hear Sen. Sessions is rejecting the rescue buyout on the basis of immediately disproven de-regulatory theories.

Do not give these bad albeit intelligent people the combination to the safe without a whole lot of constraints on access and use of this money.

I believe we should all be concerned with the bail-out! Our elected leaders are making hasty choices that will have long-term repercussions. It’s my opinion that we are being duped into believing that paying money to massive businesses is in our best interest! Why should we give more money to companies that already have too much power? We should be outraged! Instead, we’re being fooled into believing it’s our idea!

“I believe that banking institutions are more dangerous than standing armies… If the American people ever allow private banks to control the issue of currency…the banks and corporations that will grow up around them will deprive the people of their property until their children wake up homeless on the continent their fathers conquered.”

Thomas Jefferson

“Our great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men…who necessarily, by very reason of their own limitations, chill and check and destroy genuine economic freedom.

We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the civilized world—no government by free opinion, no longer a government by conviction and vote of the majority, but a government by the opinion and duress of small groups of dominant men.”

Woodrow Wilson

I would rather have Obama and McCain in Washington activily involved in solving this problem than listening to POLICTICAL ROPE-A-DOPE from Oxford, Miss.

Why is staying in DC doing your job as a senator during a crisis considered political opportunism?

We are talking about a fundamental change in our free enterprise system - Social Welfare for bankers. A profound change in our philosophy!

I do not want to rush into a $700Bil “solution” that will result in taxpayers buying junk while bankers and political hacks keep their fat salaries and the good realestate.

Put on the Brakes! What are you asking me to buy into?
Tell me in clear, plan English.

James

ps. Jack “Beedee” is so biased in his comments that his time speaking is a waste of my time listening. Work on your objectivity or you can write me off as a contributor!

Again:

Jack Beatty is one of the Great Enlightened Voices of the media world, and one of the best reasons to tune in to On Point. As for balance, not only does Tom always balance his guests in terms of perspective, but Tom himself always goes to extremes to play Devil’s Advocate… sometimes to my frustrated consternation.

This is serious, something has to be done.
McCain is making politics out of a crisis as are his Republican cronies.

Today the state Treasurer of Massachusetts came out and said the state is running out of money. The credit crunch is starting. In the next few weeks more and more states will be having these problems. This will trickle down to to other business’s and layoffs will start.

McCain seems to be showing me that he is not fit for office.

If he can’t multi task and do more than one thing how the hell is he going to be president. Every day the president has to deal huge amount of issues. So is this how McCain will lead, suspend the democratic process because of a crisis.

I am not happy with the bailout, but doing nothing is not an option.

Politics is part of anything that happens in Washington. It is impossible to remove it and all are guilty of it.

If Obama is such an economic expert, why doesn’t he take a couple of minutes away from fundraising and debate preparation and solve the problem.

“Why is staying in DC doing your job as a senator during a crisis considered political opportunism?”

What exactly is McCain contributing down there in DC? It smacks of political opportunism just like his phony surge argument. US paid off a bunch of sheiks in Iraq to stand down and then McCain trumpets his political courage as a surge advocate. So is here, he is going to sit at the side of the table keeping his mouth shot looking for an opportunity to take credit for something, anything. Opportunist.

I would rather have Obama and McCain in Washington activily involved in solving this problem than listening to POLICTICAL ROPE-A-DOPE from Oxford, Miss.

Why is staying in DC doing your job as a senator during a crisis considered political opportunism?

It’s called democracy it’s part of the process.
It’s two hours and excuse me but I for one do not think that a crisis like this means that our democratic process stops. If anything I would like to hear a good debate on what the hell these two men would do moving forward.

Instead of canceling talk about the economy.

Thank You MilesWalker for the quotes.
For its a big RED flag that a government, who you’d expect to do everything in their power to maintain calm and confidence, is beating the ‘crisis’ drum.

If we let the chips fall, wouldn’t it just give rise to the Bank of Gates and Buffett Financial. This is to save entrenched power, not the economy.

I want my representatives and yours focused on this crisis. Bear Stearns, IndyMac, Fannie Mae, Freddie Mac, Lehman, Merrill, and today Washington Mutual have failed or been “rescued.” This is historic chaos that needs to be addressed and quickly.

Watching two guys dodge questions except those they answer with snippets from stump speeches is a waste of time. They’ve debated all day every day since the campaign started. If you are unclear on their views, check out their websites.

McCain’s and Obama’s job right now is to run for President. There are 48 senators left in DC. In addition to all the Congresspeople, President, Treasury Secretary and Fed Chairman, as well as thousands of government and private professionals. Oh and don’t forget the “most powerful vice-president” in history. I think we can get by.

Where is Dick Cheney? I think he could say something like: “simply stated there is no doubt that this crises has gotten out of hand.”

Correction. There are more than 48 senators left in DC. I hope.

Much of the language of the current crisis bothers me as does the propensity for everyone to blame one party over the other. Fannie Mae - one of the centers of this economic debacle, has been around since the new deal. Both Mae and Mac give substantial contributions to BOTH parties. Some data suggests that of the top 10 recipients of contributions, 7 of those are Democrats. To say that this problem occurred under the Republican Party is, I believe,a little too partisan. This is a multifaceted, complex problem - from those that bought houses their wallets could not afford to the lenders that made these bad decisions possible. Also, Wall Street is not the center of the problem - it is the banking industry (lets get our language correct here). These are related but entirely different areas.

I am by no means an expert but I do know enough to realize there is a lot of screaming going on with little substance. On the debate, I believe that McCain did make a political decision to stand behind his mantra “Country First” - right or wrong. I doubt that he is trying to avoid the debate since it is supposed to focus primarily on foreign policy and national security. Sorry to not be so brief.

“A fitting end for a failed Presidency and the ideology of the right: President Bush and the conservative movement’s Little Big Horn…”

Right on Peter!

I’m sorry I’m missing this show, gotta listen to it later. Sounds like a winner.

Go Jack. Go Tom.

As leaders of their parties, McCain and Obama need to focus their efforts on the crisis. If Obama focused his supposed economic expertise, he could get this done before lunch. Then we wouldn’t have to worry about our bank deposits, money market funds, retirements, jobs and everything else we hold dear.

Why can’t Obama just be presidential and rescue America? Does his real allegiance lie elsewhere? Makes you wonder.

Well…Obama is not President. We have one (albeit he’s asleep). Why can’t you republicans accept responsibility. McCain-Palin…she does give great interviews.

Great, so while the country implodes, Obama would rather have dinner with celebrities. Says a lot about his character.

As far as the President goes, he’s made his proposal. I haven’t heard a Democrat one yet. I know this Democratic Congress is used to doing nothing, so it must to tough to even try.

Republican candidate John McCain said Friday he would attend, after initially saying he wouldn’t unless agreement was reached on a rescue plan. (AP)

So much for courageously standing up…being a leader and not debating. Sounds like a flip-flop…opps a poll just came out saying the public wants the debate. Way to GOP.

I think the prospect of debating Obama has McCain looking a little Palin the face.

“McCain said he would delay the debate “until we have taken action to address this crisis.”

“He is optimistic that there has been significant progress toward a bipartisan agreement now that there is a framework for all parties to be represented in negotiations,” the McCain campaign said in a statement.”

Sounds like he solved the problem, no thanks to Obama who couldn’t be bothered with the troubles of little people.

Gee, thanks McCain. Problem solved, says Jack.

At least the problem of forward movement on a bipartisan agreement. Your gratitude is noted John.

Jack your partisan diatribes are helping.
I get it your a republican and a McCain supporter.
Good for you. Please stop using this forum to spread your lies and misinformation.

I don’t like Obama but I really dislike more McCain who shows he clearly would not be a good president by acting like adolescent boy who had his game taken away.

I like the republican idea of offering insurance instead of a complete buyout. Right now the changes made in the bill are better. Again to do nothing would be financial suicide for the country.

By the way McCain had little or no role in this at all, and by all accounts he was more of a hindrance and this is feedback from both parties.

McCain politicized a huge crisis for his own gain.
Obama acted like and adult, remained calm and sounded presidential.

Good People of NPR and our country in crisis-

Please address the CAUSES of our current crisis and debate as to who has the RIGHT SOLUTION.

We will NOT be able to make the right choices re: types of bail-outs, policy changes, who to elect president, until we discuss CAUSE.

These are my humble assessments- I may be wrong but I know for a fact that those of us who think and educate ourselves about these issues (at least in Iowa)- who are not in it to get rich but to live modestly and to see the entire population housed, cared-for and fed- are in agreement with me.

Q 1. What are the top 3 reasons that the financial institutions (FI’s) are failing?
A1. Unethical/ illegal lending by FI ’s to common people who were not able to keep up with their debt. Greed- probably?
A.2. Over confidant/ignorant lending by and swindling of FI’s. Mismanagement or greed?
A.2..Common borrowers unable to pay debt:

Q. 2. Why are common Americans unable to pay on their debt?
A 1. Unemployment much worse than index calculates. If it is calculated by “who receives unemployment benefits”, then the “rate” is faulty because benefits RUN OUT quickly and many of us are not receiving them any longer. The rate of unemployment is MUCH more serious than currently admitted.
A. 2. We CANNOT find employment that is sufficient to pay our meager cost of living. Job to over-seas, and top management disregarding needs of workers.
A. 3. Wage gap is much worse than top echelon admits…Most mid-western MIDDLE CLASS make between 25k and 60k a year! We live simply and have to borrow when illness, job loss, and housing taxes increase. How can we be accused of mis-borrowing?
A. 3. When we- lower and poverty classes are in crisis; when illness, job loss, affordable costs of living, and housing taxes increase; we can no longer get help from the government agencies like Social Security Disability Insurance, Unemployment, Public Housing and Medical Assistance, to help us get up and out of the crisis.
A. 4. AND the measurement lines for “What is poverty according to the gov asst programs for a family of 3?” have not been adjusted to account for inflation for decades. The poverty for my family of 3 is under 24k /yr. This means NO ASSISTANCE in most departments! How can we even sell the house and pay for 1st and last months rent? We are cornered and increasingly hopeless. Just ASK US! Example: Due to spinal injury I have made only $340/month (child support for 2 children) for the past 8 months. My income was only part-time for 3 years while I pushed myself to further injury because I had NO CHOICE but to try to provide food and shelter for my kids- THIS is why I defaulted. SSDI deny all claims 2 or more times which takes 1-2 years … 1-2 years of NO INCOME. I have sold everything. We could teach lessons on simple living. We would be elated with 35k / year.
WHY this severe lack of funding and workers in gov assistance?

Q. 3. Why haven’t poverty measurements been adjusted to account for inflation for decades ??
A.1 Conservatives call assistance to poor and lower class (and monitoring of fair and living wages) socialistic “BIG GOV!” Bush and Reagan induced radical privatization of former government agencies that monitored ethical distribution and whose purpose was NOT PROFIT but providing basic rights for all Americans.
A. 2. Republican practice redirecting dollars from these remaining agencies of support for the bottom classes to the tax breaks/ subsidization for the major corporations & earners over 100k/yr.
Q. 4. Why the tax breaks/ subsidization for the major corporations & earners over 100k/yr? A. 1.. The theory of gov assistance to the TOP of our economy does not work! The workers of this country who make under $90k / year are suffering while the CEOs and upper middle class (what a strange definition???!) make money off of stocks and tax breaks. How is THIS NOT BIG GOVERNMENT? Sadly, it sounds strangely fascist in a way.
A. 2. aggressive war spending that is present due to the real fact that our gov has swindled smaller countries for a hundred years. We are bullies that MUST make amends. Terrorism will continue until we change our foreign relations. This is why I believe Obama will help us in the long run- I think he gets this. The big gun era is over.
A. 3. reckless and greedy gambling (borrowing and spending the money)withing global trade practices.

Americans- please educate yourselves and quit the deluded idea that this country can still function as a capitalist money machine. We, the people, are paying a drastic price- failure of basic rights as defined in our constitution is causing our demise. There was a rational, real reason that our people are supposed to be entitled to- and must have- housing and food, and fair wages. Regarding religion- WE DON”T HAVE TIME TO ADDRESS THIS RIGHT NOW! Practice your religion at home. Let the Gov use their time focusing on more critical issues right now…please.

Capitalism - as we practice- has been tarnished by greed, out-dated theories of socio-financial functioning, and ignorance (the rich and those in power HAVE NO IDEA HOW WE LIVE DAILY! ) I challenge any one of them to come to my house and manage it with my income! We ARE intelligent and capable if we have SOMETHING to work with. My credit score was 786 (excellent) while I earned only $28k a year, owned a home, ran my own business, and raise two kids by myself. AND I was happy!

Correct me if I am wrong- I, myself, and all Americans need real answers, rational explanations that take more than a SOUND BITE. Are we smart enough to listen and learn? Will our government start believing that it is best if WE ARE INFORMED? Will the rich pay dollar per dollar taxes as we lower workers do?
I hope so.

Sincerely concerned,
iowa woman

Has anybody seen the fake loan interview Jon Stewart did last night with Bernanke and Paulson? They were applying for a $700 billion loan and he was a loan officer. Funny stuff.

I’ve been trying to sort this out for myself (I am not an economist, but as I was trained in systems theory, I have long been interested in economic oscillations, i.e. business cycles, long waves, and stability properties of the global financial system). A long-term structural problem is that persistent economic forces eventually gain political control of financial constraints that dampen the natural oscillatory dynamics of markets. The weakening of these constraints seems to produce many more opportunities for speculative excess that create much more severe boom-bust cycles than would otherwise occur from inherent demand-supply overshoots and mass psychology herd dynamics.

It seems that there are two problems now, one generated by bad mortgages and another one generated by derivatives (e.g. credit default swaps). Why is $700 billion needed, and why doesn’t anyone really know if this will be sufficient? The bad mortgage problem is apparently on the order of $300 billion at worst (see http://devilstower.dailykos.com/), but the derivatives market is apparently much, much larger ($50-60 trillion (!) is a figure I keep seeing), and since it is totally private (secret) and unregulated, it is difficult to quantify its size or soundness. This may be why Paulson thinks $700 billion may be needed, and why he cannot guarantee that this is enough. But even if the Feds buy up all the bad mortgages, there may still be system-destabilizing chain reactions of losses due to these virtual guarantees. These microscopic financial black holes are moving through our economy, sucking up money — but will they reach critical mass to implode the whole thing?

So it looks like these virtual assets are where the house of cards really lies. Brick-and-mortar houses have inherent use-value and there is a bottom to that market, but poorly secured virtual guarantees do not.

If someone out there knows better, please do disabuse me of this idea if I am wrong — I’d like to believe that things are at least potentially under control, and someone out there has a firm grasp of the situation. How much of the current credit crunch is due to bad mortgages vs. derivatives (are they even separable)? How do people like Soros and Buffet think about the stability of the world system at this point?

Jeff, by all accounts, I assume you mean Frank and Pelosi. If not, prove it. It seems like nothing was happening until he showed up, while Obama was MIA, except if there was a photo op.

whatever the outcome this election is going to be a historic one for sure, it’s been quite interesting leading up to it so far. We’ll see what this will all bring to us. hopefully some GOOD Changes, We NEED IT!

I think the agreement was first announced while McCain was still “racing to the airport”. When he showed up all of a sudden the talks broke up. What a joke this McCain candidacy is.

Anyways, I have a friend who goes from forum to forum injecting sarcastic and contrarian points of view just to provoke the other side. Jack, way to go man.

McCain is still a joke.

“Sounds like he solved the problem, no thanks to Obama who couldn’t be bothered with the troubles of little people.”

This is a joke. This jerk waited until the last minute, shows up and takes a wrecking ball to the agreement. Whether you like this plan or not, leadership would require one to be involved from the beginning and if you object, voice those objections then. This was political and childish.

Thank you Tom for the excellent discussion in the 1st hour of your show today. I think you have a fantastic program. I listen almost every day.

I had to let you know how much I appreciated your closing comment today, “may your personal finances survive the weekend.” You put your finger on exactly what I’m feeling at this “perilous” time. It’s as though I’m standing on the edge of a razor. It’s too late to sell and reposition my allocation, yet to leave it be may mean to lose it all… Can we survive the confidence game?

And if that’s not enough, I/”Main St.” have already taken a $100,000 hit in my 401K since the beginning of this year. Ouch!! It’s helpful to hear you and your experts and guests discuss this crisis in more detail. I hold out hope that we don’t collapse into a 2nd great depression.

Thank you again. As always, your show was enlightening.

According to most in this thread, leadership is best demonstrated by not showing up at all. Where was Obama on the investment tax credit for alternative energy extension bill? I thought he cared about this one.

According to most in this thread, leadership is best demonstrated by not showing up at all. Where was O on the investment tax credit for alternative energy extension bill? I thought he cared about this one.

I’d like to know the answer to this question, too! McCain was also absent from that vote but I didn’t expect any support from him. As an advocate for alternative energy (and a shareholder in Evergreen Solar) I was very disappointed in Obama on this one.

Hmm. Fifteen years of Republicans’ passing bills written by lobbyists without even reading them… Jack, you really need to redefine your concept of leadership.

Honestly, harping on Obama for not being present to vote on a particular bill!

That’s the only kind of smokescreen tripe Republicans have left to resort to.

Everyone knows that not a single congressman is present for half of what get voted on.

At least Obama has a good excuse… he’s been running for the highest office in the country.

John, I’m just trying to figure out what this guy thinks is worth his time, what he cares about. I understand he’s busy making the same speech over and over and fundraising. That’s fair.

You’ve given him a pass on the worst crisis since the Great Depression and on global warming and energy independence. Fine. Hopefully we can get on his calendar at some point.

I suppose the fact that the Democratic Congress couldn’t get anything passed the last two years is because they were too busy reading.

If you want to see some bills passed, vote out the obstuctionist Republican minority… they wreaked enough havoc that even someone such as yourself should admit it’s time to give the other party a chance to pursue their agenda without obstruction. Then we’ll see if the Rebulican’s dismal aftermath can finally be improved somewhat.

09/26/2008

HOW TO HOODWINK THE STUPID DEMOCRATS

Who says that Mr. Bush is the only highly functioning moron in Washington DC. ( Paul Bagala did). But apparently there is no shortage of highly functioning idiots in this nation of ours.

First take the investors on the Wall Street, all those highly functioning idiots have been making money for years , so they got so cocky they started to buy pure horse manure in the hope of making money. Well have we not all seen the movies where some crook is paid off in sacks of news paper clippings? But now we have the US Government stepping in to buy up these. And who comes out at the head of the line to put the money of the United States in the hands of the Wall Street in exchange for the proverbial horse manure but those highly functioning idiots of the other party the Democrats.

If the goal of a con game is to urge or to trick someone in to doing something really stupid, this con is working like a charm. Eight years of Wall Street greed and fiscal mismanagement of the Bush administration and who is ready to sell her virginity to save them but the Democrat Party, what a deal. I knew selling ones virginity was about to become the new vogue but did not know that the Democrat party would be the next in line to carry on the new tradition.

I believe that Obama and Reed and Pelosi mean well, they claim they don’t want to see the people getting hurt. But the reality is that the fix is already in, bail out or not the economy will suffer, with the increase of seven hundred billion dollars in the deficit, the dollar will fall, the interest rates will still go up, real estate values will still fall as the air will still be going out of the housing bubble and the securities that the government will be receiving will decline further in value. Housing will remain slow for a while still, so spending this seven hundred billion will only do harm to the United States. Keep the money for the day when it really hits the fan as it still will.

There are solutions for the fix we are in, not easy not nice and not palatable but we have created the mess and we must clean it up, raise taxes, increase capital gains taxes with the only offset allowed for investment in factories and creating of jobs in the United States. Encourage and support public transportation. Reduce spending , mostly in section eight housing payments and payments for children on welfare, people should not be making babies to get the benefits reduce Medicaid. There is yet more on my blog.

While in the majority, Republicans had to contend with a Democratic minority. Either the Dems didn’t have an agenda of their own or maybe Repubs were able to build bi-partisan support for measures their Congresses passed.

Calling Repubs obstructionist is a pathetic excuse for Dem laziness.

Not to familiar with the last couple of congresses, are you Jack?

Rebublican’s had enough of a majority when they were in power, that they run roughshod over the Democratic minority… Dems have never had a sufficient majority to do the same.

That may (most likely will) change with this next election, however.

Minorities of any size have various procedural tools at the committee level as well as filibuster capabilities.

I believe that Obama and Reed and Pelosi mean well, they claim they don’t want to see the people getting hurt. But the reality is that the fix is already in, bail out or not the economy will suffer, with the increase of seven hundred billion dollars in the deficit, the dollar will fall, the interest rates will still go up, real estate values will still fall as the air will still be going out of the housing bubble and the securities that the government will be receiving will decline further in value. Housing will remain slow for a while still, so spending this seven hundred billion will only do harm to the United States. Keep the money for the day when it really hits the fan as it still will.

I agree with all of the above.

It’s just astounding to me, especially given Bush’s track record (first he “fixed” our civil liberties, then he “fixed” Iraq, then he “fixed” New Orleans, now he wants to “fix” the economy) that it’s the Democrats who are supporting him on this!

I do not understand why the Democrats are so enamoured of a plan to bail out major Wall Street institutions with government money. There is NO reason to have any confidence in this plan or its estimated costs. A group of rebellious Republicans whom I normally wouldn’t be caught dead at a prayer-breakfast with, may be our last hope of avoiding an expensive disaster.

(BTW - people who are sick of seeing me in these forums should avoid reading the Boston Globe’s Letters page today)

I don’t believe Obama, Reed and Pelosi mean well. I think they are being purely political. Come on, Pelosi flip flops on drilling and then it turns out she’s got $100k invested in a T Boone Pickens partnership. Reed and Obama have been involved in shady real estate deals. At every turn, these guys blame the current mess on the Republicans; forgetting their involvement in deregulation during the 80s and the sizable contributions they took from Fannie and Freddie.

The economy will/is suffering. This package will help slightly, at a minimum. Bankruptcies and “rescues” of some of the largest institutions in America, many of which survived the Great Depression; it’s hitting the fan right now and now is the time to act. It’s already an expensive disaster,and getting worse.

The economy will/is suffering. This package will help slightly, at a minimum. Bankruptsies and “rescues” of some of the largest institutions in America, many of which survived the Great Depression; it’s hitting the fan right now and now is the time to act. It’s already an expensive disaster,and getting worse.

For $700B I think we need more than just a scattering of opinions that it will help slightly. If you read the economic and business press you will see that expert, professional opinion is sharply divided. We need a higher degree of confidence to spend that much money and Paulson has not made a convincing case that this is the right solution or that we have a clue whether $700B is the right number.

We’ve had recessions before; we’ll have them again. For a fraction of that $700B we could provide extended unemployment benefits and other cushions to help the worst-hit innocent victims of this while we ride out the storm.

If you’re looking for a plan that is guaranteed to work and that everyone will support, you’re going to have to wait for a long time. Hopefully, something will still be standing when you come up with it.

If you do nothing on the credit issue, extending unemployment benefits will be extremely costly as the unemployment rate will skyrocket.

You’ve given him a pass on the worst crisis since the Great Depression and on global warming and energy independence. Fine. Hopefully we can get on his calendar at some point.

As I said your agenda is getting the better of you.
I blame both parties for this mess, however the lion share does fall on the republicans.

Jack your assertion that until McCain arrived in Washington nothing was being done is a funny and comic.
Your making stuff up. McCain just this past Monday said the economy was sound. Then changed his story, then changed it again.

Obama had made comments to the contrary and in 2006 was bring up the issues we now face.

I don’t have any problems with people being conservative, liberal or progressive. My problem is when people like yourself seem to relish in falsehoods and exaggeration of the truth.

McCain has a 26 year record of voting for deregulation in this area when he could be bothered to show up to vote. He is one of them. He has 86 former wall street lobbyist working for him. Give me a break, this guy is not a maverick, anything but. James Garner was…

Anyway as I said there is plenty of blame to go around for this mess.

In fact most of politicians are two faced hypocrites.
Show me an honest perfect politician and I’ll show you
the blue unicorn I’m keeping in my garage.

If you do nothing on the credit issue, extending unemployment benefits will be extremely costly as the unemployment rate will skyrocket.

The US workforce is about 140 million people and the current unemployment rate is around 6%. So if it rose to 10% that would be an additional 5.6 million workers - let’s call it 6 million additional unemployed. These workers would already be eligible for state unemployment compensation, but let’s say the federal government granted them an additional $30K per worker. That would only be 180 billion - little more than a quarter of the proposed number for the bailout.

And anyway, we had unemployment in the early 1980’s that approached 10% - it wasn’t pretty but it didn’t require a huge federal bailout.

Most economists think that even with this plan (or some say because of it!) we’re going to have a nasty recession anyway, but now where’s the money going to come from to help the victims?

If you’re looking for a plan that is guaranteed to work and that everyone will support, you’re going to have to wait for a long time.

But this is still a democracy and the polls are showing no clear indication the public supports this plan. A USA Today polls shows support, but a Bloomberg/LA Times poll, and a Rasmussen poll show opposition. Even Congressional supporters of the bailout are reporting that their emails and phone calls from constituents are running strongly against it.

Also among professional economists there seems to be strong opposition to it according to reports by the AP. So while I agree that we can’t expect a perfect plan with unanimous support we can certainly expect a plan with better public and theoretical support than this one.

OK someone is deleting my posts.
Why?

I take it back this bailout is starting to smell like a bad fish.

The bailout is for the big money and I bet when the dust settles the ‘provisions’ will only be window dressing.

While all of this was going on the big three auto makers got billions to make more fuel to convert to more fuel-efficient cars. They have known for years this day would come but instead they kept making SUV’s.

If any sector of our economy deserves to go down its’ the auto makers. Sorry auto workers but your management screwed you and it’s not my job to bail you out.
However it seems I did.

The Japanese car companies in this country have been making these cars for years and suv’s but you don’t see them getting any bailouts.

We’ve got to get rid of the deregulation crowd, and we’ve GOT to get rid of the idea that profits and productivity are the ultimate priorities.

Who could vote for a third term of these clowns?

No, I don’t fully understand the credit crisis, and I don’t understand the bail-out.

I say Obama should play his cards close to his chest, run against the frat party in DC, and win — though the heavens fall.

We need a new government. Throw the rascals out.

to see the united states in a state of disarray is a total embarrassment to any patriotic american is a disgrace. i hope the next occupant of the oval office can clean up the mess left by the current adminisration.

I just watched Diane Sawyer’s piece on the candidates and what happened to McCain’s first wife?

She just glossed over how she held vigil for him throughout his captivity and how he had an affair and dumped her after her car accident.

This crisis caused me to think for a second — maybe, money doesn’t just trickle down through the economy. Perhaps, it also grows up.

Let’s say, at least, that it’s a give and take between the groups and the individuals — we work for the organizations, and the organizations work for us.

As much as I feel we need to rescue the economy, I would also like to see us take a lesson from this experience — that we can no longer ignore the problems that ordinary, average individuals face in their daily lives. Because now we know that these problems, which politicians have too often ignored, threaten our economy and thus our security.

I would hate to see this necessary expenditure limit our investments in education and civic infrastructure since these are fundamental to our economy.

Yes, we need to address this immediate crisis, but there is a long-term crisis on the horizon as well.

Please join my campaign to eliminate the tedious use of the word ‘basically.’

Here is the reasoning::

The word “basically” is an overused verbal tick which demeans and condescends to the listener. It is at the same time a way for the speaker to inflate his own self esteem by flogging and repeating words that appear to emphasize personal knowledge.

It is a fault which has become, I fear, some sort of custom or accepted colloquialism.

Here was yet another day when I turned On Point off for the interviewees and the callers both sounding like school girls on cell phones.

Lon –

A more generous reading of the use of the word “basically” might go something like this:

“Basically” can be annoying, but I don’t know that it results from people trying to “inflate” their own importance or “emphasize personal knowledge.” It may be a “tick” (like “sort of”), but I think it results from a rhetorical situation in which a number of people have valid arguments to make in a very limited time about complicated issues.

Rather than speculate on the motives or character of the speaker using the word “basically,” I think it would be more interesting to analyze how the utterance works in the conversation.

In the on-air discussion with a panel of speakers and a moderator, I think “basically” cues the immediate audience (the moderator and other discussion participants) that the remarks the speaker are about to make will be delivered economically, even though the point the speaker is attempting to make is complicated and could, if there were more time, be made better at greater length.

It is the speaker’s way of a) promising to be brief and allow others to speak; and b) signaling that he or she will encapsulate as best he or she can a point that (he or she would argue) could reasonably be said to require a more patient and lengthy explanation.

Actually, ‘basically,’ makes a bigger impact.

(Two overused and one misused words.)

In spoken English, “actually” and “basically” are relatively harmless adverbs, there to help lubricate and facilitate an exchange (more often than not) that the speaker acknowledges (implicitly) includes more than one valid opinion or voice.

So anyway then actually I’m pretty much basically just sort of like not really in some ways into people commenting on how people talk all the time.

This big bail out is still puzzling me. I heard that this rescue plan pays for the bad debts of some foreign banks as well? The republicans are getting praise for fighting against this bail out. Are they just being political and not responsible, not providing any leadership? What is the responsible things to do? Should Congress rush into settling this big bail out package? Is the market really going to melt down? people will lose their jobs? small business owners won’t be able to get loans to run their business, and employees won’t getting paid etc. if the bail out plan doesn’t get settled quickly?
This bail out rewards bad behavior of the investment banks and Wall Street. On one of the shows, Tom mentioned that in 2007, 5 major investment banks have bonus packages totaling $39 billions! It is not fair that these executives privatize the profit, but publicize their losses. Maybe we should let the Wall Street crash just like during the depression time. The irresponsible lenders and borrowers should pay for their mistakes. After-all, they are the one who take a big he profit during good times; they should suffer the risk during the bad. What would the market crash do to a responsible person if he/she has no need to take out a loan, and has a stable job? How would the melt down affect ordinary people who have been responsible with their money? The 401K investment for most of us is greatly reduced already. Will this bail out plan and the continuing wars in the Middle East bankrupt U.S. just like Russia a decade ago?

Mr. Cassano and his colleagues minted tidy fortunes during these high-cotton years. Since 2001, compensation at the small unit ranged from $423 million to $616 million each year, according to corporate filings. That meant that on average each person in the unit made more than $1 million a year.

Excerpt form a New York Times article on AIG.

I don’t no about anyone else but in reading this article this statement“compensation expenses took a large percentage of the unit’s revenue”strikes me as the heart of the problem besides lack of regulations.

How is that a good business can be run like this?
How can one run a business in which the compensation is almost half the revenue?

I am not interested hearing about without these types of pay packages that wall street will not attract the best and the brightest. This argument is based on greed and greed alone.

How is that a good business can be run like this?
How can one run a business in which the compensation is almost half the revenue?

The executives’ compensation packages are approved by the board of directors, who are elected by the shareholders on a one-vote-per-share basis.

Most of the shareholders of these failed firms like Lehman, AIG, Bear, etc, have been seen their stock holding become virtually worthless, so in that sense I think some justice has been done because the people who approved these ridiculous compensation packages have lost millions, if not everything.