Huge Bailout Proposal--$700 billion--Suck the bad debt out of the financial system

I think i have an idea that costs nothing. will unclog the system and would have a much better chance of success.
We should provide these banks a certain amount of loan guarantee. This would allow the market to invest in them. these new money should be treated just like in bankrupcy, they take first priority and they get US loan guarantee. I think this would be much more successful and will cost very little money.
Israel used to use something like that to get better price for capital.
Nanks in return should renogtiate the loans to a level that some people can live in. maybe a couple years of lower interest. No price reduction. Iam against that.
i want 10 million for this idea. lol for real if they want to use it they got to pay lol

 

Are you off the drugs? That made more sense than all of your prior posts combined. Congratulations on making a good point and making sense doing it!

That idea makes more sense than what they are pushing for now by far.

 

glad you like it.
affiliate program 10% lol
but you can dig it or send it to your senator.
maybe if they get a lot of email they look into it

 

If you considered total money spent as a measure the Bush Administration would have to be the most successful socialist government in the history of the world.

 

Exactly how does your version of free market works. Is it to lower the standards for those that are not qualified or give out a handout?

 

That is precisely how the United States of America works today. So what is your point?

The incompetents, the unproductive, the leeches rule the system and the government.

The inventors, the producers, and the wealth creators are held hostage by the middle-men, the brokers, and the bureaucrats (CEOs, middle-managers, politicans, etc.).

The housing pill, the Patriot Act, the war on terror, and this bailout typify the corruptness that is now the United States economic model.

I am witnessing this with my own eyes and can hardly believe it.

 

They've created socialism for the rich!

I think I'm going to become a banker - it's a win win situation.

Fuck up, and the government throws you $700b, succeed and you claim $700b in bonuses.

 

loaning money that doesn't even exist! What a nice way to clear the US's dept...

 

Why not just screw the U.S. Dollar completely. If the idea is being suggested by George BUSH - then I'm against it - his 8 years in office are a high point of special interest, hugely expensive aggressive policies, growth of the feeding pen for the "bush" pigs of Haliburton and like companies - the end result they have bankrupted the American people to the point of destroying a major foundation of economies - real estate i.e. land.

$800 billion is not going to fix the problem it is just going to bail out some mates and give them a parachute to exit before the real&*%& hits the fan.

For example Australia which is much smaller than the US (24 million pop.) - had its banks lend $18 billion dollars in NEW real estate loans - that's in just one year.

I bet the American real estate market is 20 X bigger - probably around $400 billions dollars in fresh loans in just a year - do you think $800 billion is going to make a difference in a market that size - we are talking about loans made in a decade and more $4 trillion or more - don't be fooled $800 billion is just a bail out of the elites - once again at the expense of the average joe - bush has done nothing but screw the american people time and time again - wake the &*&) up!

The total value of US home real estate is $12 trillion - is $800 billion going to make a difference? Add to that business loans, government loans, etc - adding another $800 billion in Debt is not going to help.

 

Ron Paul Smacks down Ben Bernanke in Q&A Session of Joint Economic Committe- http://www.youtube.com/watch?v=dv6rQ0U01Yc

 

This is just another gov conspiracy. Now is the time to decide whether you are a sheep or a warrior.

 

"Printing" an imaginary "$700 billion" solution will only weaken the dollar to such an extent that any benefit will be drowned by the deafening call for the replacement in euros for oil; then comes the "amero" (could be called something else) for us. This has all been planned.

 

The money going into play isnt supposed to cover the whole figure... I gather it is roughly the amount that covers the projected uninsured default or maybe the projected actual default. Not sure exactly what multiple theyre quoting, but no, you're correct, that isnt the full figure for the value of the entire market. They're buying securities, not the full value of the underlying assets.

If were to buy this right it *might* actually get paid back and provide return... but doing something right isnt standard government practice. I cant think of anything worse than putting money into the hands of politicians and expecting a good outcome, except maybe giving my carkeys to a wino and asking him to drive it back to my house.

 

Bravo Pizzaman: creative idea. Are you proposing actual loans or are you proposing a guarantee. How big is the guarantee? How much does it cover?

Still a lot of unknowns.

I doubt if anyone has a fix on the exact number of bad debt. Its huge in its own right, its diversified amongst many institutions and buyers of the debt, and it represents aggregates and recombinations of individual mortgages.

The status of the mortgage properties is a moving target. Properties are going into default. Some properties in default have been resold. Some property owners are making late payments. Maybe they'll go to default maybe not.

Property values are falling. If I have a loan that represented 90% to value when I bought the house 2 years ago...maybe the loan now represents 120% of value...and maybe the loan will equal 13% of value in a while if property values continue to drop. Maybe my best bet is to stop paying on the mortgage and walk. The mortgage I am paying on now may be solid in that investment package...but I might walk on it in two months.

Lots of unknowns.

I basically believe in action. Banking relationships are failing right now. Nobody knows exactly what the status of these loans are. Banks are stopping to lend to one another. The financial system is in chaos.

I've been notified that the commercial real estate sales market in my region is pretty much kaput right now. Its been having troubles for about 3 months.

Basically nobody can borrow money on property now. btw: for about 30 years the Washington DC metro region has probably been the most consistent and risk free market in the nation. When things are bad it never dips as bad as other areas, tends to recover fast, and tends to see consistent highs in occupancy and overall sees rental increases. When this market hits the skids it means the rest of the nation is generally suffering pretty bad.

Unfortunately this lending crisis is moving way beyond real estate. It is affecting everything. In lieu of seeing the banks collapse and no credit available, I'd suggest start taking action now.

Nobody has all the answers. Nobody knows the size of the debt. There is no hard target on how to value the debt. The market will address that. IMHO, if the Paulson plan goes into effect, and I was doing the buying I'd buy low, low, low. Heck, I'm the only buyer....and everyone wants to sell. The only caveat on that would be to not buy so low that it puts banks out of business. After all keeping the banks afloat and making loans to one another is the sole purpose of the bailout. Exactly where that level is again somewhat of a moving target.

Pizzaman, can you explain your proposal a bit more detail. Are these loans or are they guarantees. Is their a limit to the guarantees.....or is it a blank check?

Take actions. Measure the results. Keep acting. Keep adjusting. That is actually what businesses do on individual bases.

 

What? People that meet qualifications can get a loan. Good Credit + Plus Down Payment, Plus Collateral, Plus ability to repay equals loan.

 

Many banks are not even loaning much to those with 'good credit, down payments, collateral and ability to repay' things have been tightened down big time.

 

I meant commercial real estate and sizable purchases--(sorry for the confusion)

 

@earlpearl
loan guarantee only not an actual loan.Although even a loan is better than this.
the amount of the guarantee can be the same amount that they want to give them for the mortgages. somewhere between the market price and maturity price . This will give them liquidity. it will allow the market to provide the money. and since not all banks are going to default on these loans we can cover a lot more banks and institutions.

 

Hmmm....I dunno...I'm for doing something right away.

Send it to Schumer, send it to Bernanke and Paulson, ASAP. Tell them the Isreali's did it.

At the very least, get them to buy some of your Pizza. All these guys are spending a lot of time in NYC.