flyingpuck

One of my biggest complaints these days is that if you have been a responsible and careful consumer (don't over-extend yourself financially etc), pay your bills on time etc. then your reward these days is to continue to do this , AND pay for all those who did not! Too many times it seems that even if you do something that makes no economic sense, someone will still help you to continue down that path, (wrong as it was in the first place) honestly, how is this supposed to help us?? We need more Darwin these days and less of the crap we are being fed!

Gene

^agreed Preach!!!

garylewa

You mean this????

lightfytr

Healthcare, is one of my biggest issues and guys I will have free / very low cost healthcare for the rest of my family and I's life (as a military retiree) 5 more years to go.

It is crazy to see people having to lose everything because they want to be healthy and want to get emergency treatment for their family. I understand we have built a healthcare system which is the most expensive as well as the most profitable in the world. All healthcare companies make their profit here. The disparity is just not right. Why cant healthcare, a basic requirement bea available to everyone? If not, all I know is that it is not right that me and the politicians have the best deal going...

I dont know all the answers, I just know it is unbelievable when you watch a show like Sicko... or research the issues of healthcare.

m630

its not the banks, its FAS 157 that is a major issue. the reason that banks keep tetering is because of an accounting rule that was instituted by lawyers and regulators against business. You have to mark to market each quarter based on voodoo economics. if an asset is not being sold, why would you have to mark down it potential value if you are not changing the ownership? it just does not make sense and does not work in practice.

Its not a matter of how much financial institutions need, its the accounting treatment that makes it appear that their value it signficantly below the required minimums, ex Merril didnt lose 40Billion or whatever the number was in the 4th Q, they had to write down that much due to this rule. They did not sell assets and incur 'loss' but the mark to market rule requires, hence the major hit taken by B of A, and on and on and on...

i know this stuff is quite technical, but believe me, there are so many moving parts that have to considered before we start pointing fingers and arguing on this...

i'll state again, let tarp do what it was supposed to do, run auctions to buy the bad assets, have them segregated by the govt similar to how the S& L debacle was handled in the 90s, and then the financial institutions can start reporting postive earnings and restore confidence in our capitalist economy.

ENstig8or

+2

Our problem in America is we have to coddle everyone and hold their hands and agree while they blame their problems on everyone but themselves. We have become a nation of enablers. I'm sorry, call me cold and callus, but if someone who earns $50k per year buys a $500k house with no money down, I don't care if they lose it. If they are that blind and stupid why should I have to pay up to bail them out. Of course we blame the greedy banks, but what happened to laying blame where it is deserved. Nobody held a gun to their heads and made them buy something they could never afford! People must live within their means, and the same goes for the government. Obama wants to spend a trillion dollars to stimulate the economy. Where does that come from? Ink and paper. That's all it is. Once reality sets in and the government is forced to back up all that paper, we could be in for a big collapse, much bigger than we are in now. Right now, we can not back up all of that worthless paper.

UUronL

True that this is irksome, but what's the alternative? Join the ranks of the deadbeat? I'm glad I was responsible and I'm glad I didn't put myself in a bad situation. I'll assuage my "survivor guilt" by knowing that I'm helping to bail out the irresponsible and the unlucky.

lightfytr

I hear your frustration but you are explaining the extreme which goes both ways. When a person has good credit, it means what? It means that person will honor with all their ability to pay what they owe to his creditors. When he loses his job, his wife loses her job, can't find another, deplete 401k... House forecloses.

When you qualify for a home, car, motorcycle it doesnt mean you have infinite ability to repay it if income stops coming in. This is what a lot of people are dealing with. Of course, a number of people qualified for homes they shouldnt have but lets say they got a 200k house instead of a 400k house and they lost their job, does it matter?

Afford means what? How long would you be able to go on paying your mortgage if you lost your job and all went downhill where you couldnt get one enough to cover it????

In that instance where you go into the black, you become like all the people you are talking about..

PraiseTheLowered

I read about some of these legal constraints on banks. Can you go into more detail? Perhaps post some links to support it as well. I think this is where the topic should be going towards if we are talking about the major economic issue.

JStraw

Mark to market is one of the reasons. You will have to agree that the Community Re-investment Act, predatory lending, and irresponsible borrowing are also some of the causes.

I agree that the TARP program should attempt to remove these bad assets from the books of financial institutions. But the problem has been these assets have been financially sliced and diced, and repackaged (a.k.a. "derivatives") that no one knows who holds what. This resulted in seizure of inter-bank lending which in turn froze the movement of capital to businesses and consumers.

Not a very easy problem to deal with. Hopefully we have the right people in place to deal with this. But then, only time will tell if they were right.