Capitol Hill Blue Forums Political Issues Finance, the economy & Economics How will the financial crisis develop?

Itstarted, I appreciate you providing that background.

Watching the news there was an interview of Secy. Paulson. When asked if the bailout proposal would work, he responded "it has to work." It was clear he wasn't saying there is no doubt it would work but rather that we are in deep shite if it doesn't.

Since I doubt it will work except in the short term, anyone care to chime in on what happens if 6 months from now it becomes clear this isn't working?

OK Phil, you are on record. See you in six months/

And in direct response to your question... if this does not work (which I admit is a possibility)... there is absolutely no prediction that is possible. As Iss separately posted


If this does not work, we enter a chaotic state where nothing become predictable and almost anything can happen. Unfortunately a viable economy depends upon exactly the opposite environment.

But, as I have said, I think that things will work out sort of OK.... although it seems possible/likely that world confidence in our economy and currency will be irreparably damaged.

I sincerely hope that any bailout of these high-stakes gamblers includes the provision that the CEOs and executive leadership of any company directly benefiting from a taxpayer-funded rescue must give up any form of compensation, such as bonuses, stock options, deferred compensation, and any other rewards; and receive only their base salary for a fixed period (3-5 years?). Additionally, any "golden parachutes" would become null and void. To reward these charlatans and swindlers for their bone-headed actions will only encourage more reckless behaviors and would be a slap in the face to the citizens of the United States.

Re: executive compensation...
Gotta share this one with you...

This AM, on one of the financial channels, host was interviewing a wise, renowned gray haired "expert"...
Conversation went something like this...

Host: "What do you think of the public's feeling that the top executives should not receive the multi million dollar pay outs and bonuses."

Guest: "That would not be a good idea. It will be necessary to pay these salaries to attract the kind of executives that will be able to handle the complex management challenges that are facing us during this recovery".

You couldn't make this up... Just imagine... paying the CEO who just ruined the company $140,000,000, to save it after the government buys all the garbage debt.

Just when you thought things couldn't get any goofier.......

How did the host respond to that so-called expert? I would have sprayed my coffee all over that pompous ass's shirt. Un-freekin-believable...

It turns out that executives in every other part of the world make substantially less... and seem to perform adequatly.

I have an idea... let's out source these executive jobs to lower cost foreign labor.

So! Back in the real world, today the Dow plunged almost 400 points, the dollar was down, gold jumped more than 5% in one day and oil surged more than $20 per barrel as people sought desperately to put their money into something of real value.

A rousing vote of confidence in the bailout "plan"!

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They keep tryin to put lipstick on a pig.

But I'll be dammed if the dumbed down American public is buyin into it.

I guess when you start talkin about their money, people get alot smarter alot faster.

Good editorial from Paul Krugman in today's NY Times:

Cash for Trash

Krugman simplifies the crisis into a four-step catastrophe, and argues that it must be addressed at Step 2:

Very good, Roger, very good!

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