Watching Banks Struggle Is KIND of Good

[Lavarat]

I don't know about you but all the pandemonium people are spreading of mass panic on the market over the fact that greedy people cause slippery situations.

Really I can think of 10 different things more important to our planet other than worrying about wether some bank executives are ok or not ok with the revenue that their mega bank is rolling in. Do you lose sleep over it, really does anyone feel sorry for some yuppy on wall street in a crisis. Really, please do we have to watch another news segment about the wall street crisis of 2008 I might puke. Here is a tip for those who are stuck in this economic tornadoe of high greed, low morality driven foggy situation that is the root of all the worry, so some say, stop giving money the same value as human life for once, and remember that when you pass on you cant take that money with you.

 

[DamnDirtyApe]

Yep, banking woes and instability in the markets is fun to watch because the ebb and flow of trillions of US dollars tied up in the markets have nothing to do with you, right?

Do you have a 401K, own any mutual funds? Own any stocks or bonds? Work for a publicly held company? Make a living by providing goods, services or talent to customers? Own a house? Are you an adult? Do you live on Earth?

If you answered yes to any of the above, you are affected by how the US markets perform. Banking is intimately tied to the markets which are intimately tied to the financial health of this country, and by proxy, the rest of the world's economies. When something bad happens there, it propogates downward to you whether you know it or not.

You make think you live in a bubble, safely removed from whatever "greedy wall street yuppies" do, but you don't. And who the hell uses the term "yuppies" anyway. Thought that died in the 80s.

I'm curious to know your list of 10 things more important than US market health. I have a list as well, but I'm guessing our lists are far different

 

[mike]

money is essential to our evolution at this point, it teaches us to count, and thats important

money is just a way of measuring things

personally i look at money like toilet paper.......


i dont really care how thick or thin the roll is on any given occassion, its there and i use it, if it runs out i go and get a fresh roll and install it.
the only time im ever worried about toilet paper is when i run out right when i need it most.

what concerns me most about a depression is there is often a bad shortage of toilet paper and one is then forced to use leaves from the garden.

no one wants to be doing that....

must get the poison out and kill of that stinging nettle down the back of the vegie patch..... just in case

 

[Seth]

Really I can think of 10 different things more important to our planet other than worrying about wether some bank executives are ok or not ok with the revenue that their mega bank is rolling in. Do you lose sleep over it, really does anyone feel sorry for some yuppy on wall street in a crisis.

Tis true, big banks own everything, but to think that bad times for them leaves blue and white collar workers gleeful may be an uneducated assumption.

Sure the harshness of Great Depression in America and Great Slump in the UK during the 20’s was relatively localized to those countries, but it did have global ramifications.

Look at today’s system: these corporations are global, they are pervasive in every aspect of world economy. During the 20’s the banks were hurt, yes, but the commoner was raped! Do you not think that this will not be the scenario in future economic downfalls?

Truly, economic collapse is not good for anyone, I would hate to have to stand in a bread or job line because my investments turned to shit without my input…maybe after the next big “crash” we can build a global system without the fallacies of greed.

 

[Capnkumquat]

Another serious problem with a worldwide depression is that governments typically find arms races, and military subjugation of "enemy" nations a great way to jump start their national industry.

Even though the US was slowly limping its way out of the depression by 1939, selling arms, ships, airplanes, and eventually entering WWII is what finally sent us into economic recovery. All the big government programs of the new deal were just barely keeping us from total despair.

A hot war puts everyone to work, revs up industry, provides markets for our farmers, and puts our rebellious youth on the front lines to take out their aggression on the current enemy instead of a senator or congressman.

 

[Koji K.]

Do you lose sleep over it, really does anyone feel sorry for some yuppy on wall street in a crisis. Really, please do we have to watch another news segment about the wall street crisis of 2008 I might puke. Here is a tip for those who are stuck in this economic tornadoe of high greed, low morality driven foggy situation that is the root of all the worry, so some say, stop giving money the same value as human life for once, and remember that when you pass on you cant take that money with you.

Yes, human life is more important than money, but I think you need to understand that right now up to 14,000 people are in serious risk of losing their jobs more or less overnight over just one bank failure alone- much of their savings, which were tied up in stocks and stock options (as many people's pensions or other retirement funds are these days) reduced to nothing over the course of a month. To say nothing of the hundreds of thousands more who are affected on wall street- and of course, the millions upon millions across the country. Across the world, you could even say.

The very few people at the top who actually made the decision to invest in the subprime market are more or less the lords of industry. These people rake in the millions and generally will not be affected- or at least they won't be worrying much about how to pay the rent. It's the thousands of day-to-day employees- some of them maybe the people you refer to as yuppies, trying to start a career and a family- who are hurt. That's how it works, so I must disagree, I don't think it's good at all.

Feeling happy that someone employed on wall street is about to lose their job isn't any different from feeling happy *anyone* is going to lose their job, IMO. Forgive me if I have misread you, but you seem to talk of the value of human life, but you also seem to think someone else's misery because they work in the banking industry is something to take pleasure in. I don't think anyone implied that these people valued money over life- but many of them are about to lose their jobs. And no matter who you are, if you don't think this affects you, or won't affect you, just go out and read a newspaper- this is just one symptom of a very bad economic situation in which just about everyone is paying a price.

 

[Poi]

Just to get a bit more specific in one area alone, imagine all the investment dollars poured into just one bond market generated by those banks initially, the mortgage industry. Bad loans were bundled into CDOs, a particular derivative, Lavarat. More than likely, the school district in your area probably invested in that type of scheme under the false premise that they were AAA rated bonds. When the bottom fell out, your school district lost a large part of its investment portfolio ... bucks intended for maintaining some semblance of quality education for your children now or in the future. Those bonds are worthless now.

Every bit of the bank fiasco affects your life directly in some manner. You, the tax payer, pay the price, not those money grubbing bankers who walked away with your loot, your child's education.

Banks refuse to loan money because a school district has no hard assets offer as collateral. Your school district loses its competitive edge in education, your house value plummets (even further) because of it. Your neighbors (perhaps teachers) lose jobs and must abandon their homes when they can no longer service the debt. Your neighborhood becomes just more urban blight with higher crime. The banks go forth into more trouble trying to service an overburdended housing portfolio due to foreclosure and the cycle continues to spiral.

And that's just one scenario. The way out is saving money, but with the falling dollar, inflation and no available credit, how does one do that? This affects everyone to some degree. Even the dude who stole your child's education.

 

[Gil Bavel]

Let's get one thing clear: We're talking about investment banks, and in particular, predatory investment banks. The kind like Providian, who STILL after being investigated TWICE, are allowed to go nearly unregulated charging people 30% interest on their credit cards, and due to their massive donations to BOTH campaigns EVERY election, are allowed to prey on the gullible, naive and unwary who will NEVER get to pay off their credit cards, not in a million years, if they only pay the minimum balance.

Banks like Chase Manhattan, CitiBank/World/Group benefit from all the highs and lows of the stock market. When Enron fails, they win. When oil goes to $115 a barrel, they win. When they offer home loans and student loans to people that can't possibly pay for them, they win.

It's nice to see them in trouble for a change. I'm not talking about your homegrown mom and pop bank that owns the title to your house, or helped you remodel last year, to get new windows.

But when the government comes along and bails them out to the tune of $2.7 billion, the taxpayers foot the bill and then the CEO comes riding out on a golden parachute, just so that George W. Bush's daddy's company the Carlyle Group (also Osama Bin Laden's company) can get rich quick off of it, <i>that's</I> not kind of good.

According to the International Herald Tribune:

"Paulson also sought to send a calming message that the administration of President George W. Bush is on top of the turbulent situation. "The government is prepared to do what it takes" to ease turmoil in the financial system and minimize any damage to the U.S. economy, Paulson said during a series of broadcast interviews. The Fed's intervention "was not a difficult decision. It was the right decision."

The Fed, using a procedure from the Depression era of the 1930s, raced to the aid of Bear Stearns on Friday alongside JPMorgan Chase. Bear Stearns had made a fortune in mortgage-backed securities but faced a possible collapse after those investments soured. Wall Street plunged as fears spread about whether other big firms were in jeopardy.

"When you go through a period like this," Paulson said, "policy makers need to balance various consequences."

If these companies have made a fortune in mortgage-backed securities, they ought to have to die by it, and give somebody else a chance in a truly Capitalist system, not be bailed out by Papa Bush and his friends at the Fed (which is neither Federal, nor Reserve).

They grabbed those stocks for literally pennies on the dollar. Of course, today's American dollar is only worth 4 pennies, anyway, in 1913 money (when it was backed by gold).

http://news.yahoo.com/s/ap/20080314/ap_on_bi_ge/bear_stearns

Back to your regularly scheduled paranormal programming.

 

[ArizonaWill]

Part of me is vengeful and wants these investment firms to suffer and die! Let the gullible and greedy who took on these mortgage loans default and go live in trailer parks or tents (or worse yet, with incontinent older in-laws).

Another part of me feels compassion for people (not corporations) who were just plain dumb and trusting, and are now facing horrible decisions about what to do with their children and responsibilities, with foreclosure looming.

Another part of me WANTS EVERYTHING TO BE OK FOR ME AND SOCIETY AT LARGE! This means doing what it takes to stop the ship from dangerously rocking. If we head into a serious recession and depression, I will be hurt. Yes, little old responsible me who has my house 100% paid off. I don't want civil unrest, possible riots, increase in robbery and violent crime, closing of businesses, deterioration of services, etc. I want the system to continue so I can go to the grocery store and trust that the shelves will be full, that the houses I pass will not be boarded up or burned down, that people are not ending up in make-shift towns (like in much of South America) along the edges of major cities. So if this means taking some of the billions allocated for Bush'es never ending war of ego and instead cushioning the blow for the "guilty" parties (for the sake of the innocent who will also suffer) then I say do it! For once, our tax dollars will stabilize the system for all of us, rather than being pumped into the bottomless pit of Bush'es war buddies.

 

[DamnDirtyApe]

Bush'es never ending war of ego

WTF?!