Bear Stearns Bailout Was HUGE

[dontfollowtheherd]

Ask anyone inside the “biz” and they’ll tell you the consequences of not bailing them out would have been disastrous. Many people don’t think they deserved it. As it is we’ll see how many more the Fed and others can swallow before facing the inevitable. Better to let the market dictate the course than trying to stave off the inevitable and paying an even greater price. Nobody’s going to wave a magic wand and have all of this stuff disappear. I’ve said it here for 18 months and to friends over the past 3 years – there’s no silver bullet coming around the corner soon.

Bush is trying hard to preserve his legacy(fwiw)in lame-duck status and Bernanke is facing incredible challenges left by his predecessor. No one wants to use the word RECESSION until after we’re six feet deep into it. Listen to the latest report from the head of the labor board today. Are you kidding me?

The recent layoffs are hitting everyone hard with a lot more to come. We may not have to worry about $4 a gallon gas after all – $5 next year is going to be the real back-breaker. Housing, flashy autos and high-ticket luxury items are a thing of the past for the next 5 years or so imo.

The psychological damage in finances over this year and next to John Q Public is going to be very severe. This will continue to be a housing and economic decline (think re-insurers) the likes of which most people never imagined. After all, it isn’t like people are sitting on top of an oil well and will suddenly be flush with cash. We are heading toward deflationary times a la Japan although the Fed is doing it’s hardest to prevent it from occurring . Expect hard times to continue for a while. Hunker down and remember, cash is king.

There will be dead-cat bounces as the charts from Rich and others have shown but the overall trend is down, down, down. The ratio of available homes to qualified buyers is going to land somewhere close to 40>1 by next year. More homes are coming on the market this month for the Spring season and many banks and mortgage companies (CV) are trying not to flood the market but have no choice the way things are going. Better to get 50% on the dollar than 25%.

[Arraya]

Ask anyone inside the “biz” and they’ll tell you the consequences of not bailing them out would have been disastrous

Why is everyone echoing this? Sorry, I just find it suspicious when the organization that caused the mess now tells us how imperative it is that they need to get full power over mitigation. I’m not buying the “if you don’t let us do what ever we want it will be catastrophic” line after Bush and Cheney…

[Arraya]

Ask anyone inside the “biz” and they’ll tell you the consequences of not bailing them out would have been disastrous

Why is everyone echoing this? Sorry, I just find it suspicious when the organization that caused the mess now tells us how imperative it is that they need to get full power over mitigation. I’m not buying the “if you don’t let us do what ever we want it will be catastrophic” line after Bush and Cheney…

[Arraya]

Ask anyone inside the “biz” and they’ll tell you the consequences of not bailing them out would have been disastrous

Why is everyone echoing this? Sorry, I just find it suspicious when the organization that caused the mess now tells us how imperative it is that they need to get full power over mitigation. I’m not buying the “if you don’t let us do what ever we want it will be catastrophic” line after Bush and Cheney…

[Arraya]

Ask anyone inside the “biz” and they’ll tell you the consequences of not bailing them out would have been disastrous

Why is everyone echoing this? Sorry, I just find it suspicious when the organization that caused the mess now tells us how imperative it is that they need to get full power over mitigation. I’m not buying the “if you don’t let us do what ever we want it will be catastrophic” line after Bush and Cheney…

[Arraya]

Ask anyone inside the “biz” and they’ll tell you the consequences of not bailing them out would have been disastrous

Why is everyone echoing this? Sorry, I just find it suspicious when the organization that caused the mess now tells us how imperative it is that they need to get full power over mitigation. I’m not buying the “if you don’t let us do what ever we want it will be catastrophic” line after Bush and Cheney…

[barnaby33]

arraya, on the World turned upside down thread I said the same thing. People keep parroting back the party line. Its not really a systemic crisis, until the system fails. If there is a real risk of that, fine come clean about what is happening (and open the books to explain why.)

Josh

[barnaby33]

arraya, on the World turned upside down thread I said the same thing. People keep parroting back the party line. Its not really a systemic crisis, until the system fails. If there is a real risk of that, fine come clean about what is happening (and open the books to explain why.)

Josh

[barnaby33]

arraya, on the World turned upside down thread I said the same thing. People keep parroting back the party line. Its not really a systemic crisis, until the system fails. If there is a real risk of that, fine come clean about what is happening (and open the books to explain why.)

Josh

[barnaby33]

arraya, on the World turned upside down thread I said the same thing. People keep parroting back the party line. Its not really a systemic crisis, until the system fails. If there is a real risk of that, fine come clean about what is happening (and open the books to explain why.)

Josh

[barnaby33]

arraya, on the World turned upside down thread I said the same thing. People keep parroting back the party line. Its not really a systemic crisis, until the system fails. If there is a real risk of that, fine come clean about what is happening (and open the books to explain why.)

Josh

[kewp]

Yeah, I don’t buy it either.

Bears Sterns was over-leveraged. Some of their counter-parties were as well. They probably would have all fallen if it were not for Fed intervention.

But, here’s the thing, not every bank in America is over-leverged. Some have actually chosen to forgo the insane amount of speculation of their peers and be prudent.

I personally think they should be rewarded for their prudence by being allowed to buy up their bankrupted peers assets for whatever the free market dictates.

[kewp]

Yeah, I don’t buy it either.

Bears Sterns was over-leveraged. Some of their counter-parties were as well. They probably would have all fallen if it were not for Fed intervention.

But, here’s the thing, not every bank in America is over-leverged. Some have actually chosen to forgo the insane amount of speculation of their peers and be prudent.

I personally think they should be rewarded for their prudence by being allowed to buy up their bankrupted peers assets for whatever the free market dictates.

[kewp]

Yeah, I don’t buy it either.

Bears Sterns was over-leveraged. Some of their counter-parties were as well. They probably would have all fallen if it were not for Fed intervention.

But, here’s the thing, not every bank in America is over-leverged. Some have actually chosen to forgo the insane amount of speculation of their peers and be prudent.

I personally think they should be rewarded for their prudence by being allowed to buy up their bankrupted peers assets for whatever the free market dictates.

[kewp]

Yeah, I don’t buy it either.

Bears Sterns was over-leveraged. Some of their counter-parties were as well. They probably would have all fallen if it were not for Fed intervention.

But, here’s the thing, not every bank in America is over-leverged. Some have actually chosen to forgo the insane amount of speculation of their peers and be prudent.

I personally think they should be rewarded for their prudence by being allowed to buy up their bankrupted peers assets for whatever the free market dictates.

[Author]

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