200 leading Economists write Congress Warning Bailout will make things Worse!

I am surprised that even the Hayek economists who are responsible for this mess are actually in agreement with Keneysian's This is unprecedented !!

The Laz a faire capitalists must be put to bed now, Its the end of Free Market Capitalism as Marx predicted. The center right must now be demolished for all time, if it is not, we will have no choice but to shift even further towrads ultra rightist nationalist based policies, under pinned by corpratists, and that is Fascism.

We are now on the cusp of a new era, do we go backwards to the failures of Fascism or do we move forward to a new form of democratic socialism?

There is no option to fix this broken system, any attempt to do so will result in the worst economic depression since the collapse of Rome. A new Dark age.

The Laz a faire capitalists must be put to bed now, Its the end of Free Market Capitalism as Marx predicted.

Let`s hope not. I don`t confuse legal stealing with capitilism.

Well they were given a free hand and they not only took advantage of it but they bit that hand too. Creating packages mixed with dodgy debt and then using ratings agencies that had clear conflicts of interest to sell them off as AAA+.

No this must never happen again. and it wont. If the US wants to continue doing business with the world, it will not be on their terms. If the US government wont regulate its own businesses then they will get no credit, not one cent.

Now either the US covers those international debts, or the world finical system will disintegrate totally, and wages are so low in the US that it will mean a deep depression, not a recession, for the US. And the US Laz a faire capitalist system is dead. No one will do business with such an unstable and volatile system again.

Its the end of Free Market Capitalism as Marx predicted.

I'm curious about this "Free Market Capitalism" you are speaking of. I haven't seen it. We haven't had a free market in my lifetime (I'm only 34). Free markets work when they are allowed to be free which includes freedom from propping up failing companies. We did it with the auto makers several times and look where that got us. Bad cars made by incompetent companies (in general. Not all American cars are bad). We've propped up telecommunications companies and let them write the bills that congress passes in their favor. A free market must be free to allow companies to fail. That is the key ingredient that we've been missing

As for mortgage companies. They were not only given a free hand but a mandate by government to take on bad debt

Free markets work when they are allowed to be free which includes freedom from propping up failing companies

The US has had free markets, Twisting the language will not change the fact that they have failed. If what you say is correct, the great depression of the 1930's would have never ended. The US tried the Hayek system, and where warned repeatedly that this would end in tears, and not just by Marx.

The free market is not working precisely because it is free, and no one knows which American banks are solvent and which ones are insolvent. So no one will lend them money.

As for the guts of your commet, well we dont still make steam trains just to keep boiler makers in a job, but there is a limit to how many people you can put out of work before the country goes completely over to anarchy.

If you want to see what happens to a country that has a true Laz a faire system, look at France, and we all know how that ended with Guillotines, and military defeat at Trafalgar and Waterloo.

The problem with free markets and competition is quite simple, Some one always wins a competition and someone loses, and so, the inevitable result is a monopoly.

Blaming the government is a popular past time for Americans and for some weird reason that seems to lead them to a ridiculous automatic assumption that, if government is bad, then private enterprise must be good. How this ever took root in the American psyche is beyond comprehension, but if Americans dont get over it, then you are going to have a very hard landing. This is the real world, there are no time machines, no second chances, no prayers will be answered, Americans are living with the consequences of their own actions, not the governments, the gov, did not re mortgage your house and blow the money on plasma TV's from China and SUV's from Japan, The American public did, They maxed out their credit cards, They allowed a government that was only elected by half the people to dictate a suicidal foreign policy, and the American people allowed a criminal gang to hijack their dangerously weak democracy, and steal a trillion $ from the coffers. They allowed a corporate culture of failure to flourish, unchecked for decades, and now you will have to wake up and smell the coffee, and realize that it is over. America has 7 years to balance its trade deficit, and so far I have not heard a single word about this fact, So if Americans are not going to do this, then the entire country will be insolvent by 2017.

So what do these Bankers actually do to get 20 or 30 million per year Hmmm lets see, They track growth, Occasionally they cut some jobs or take a bit of competition from each other to keep the ratio's right, but now come on, is that really worth a pay check of 25 million $ ??

Nothing is worth a paycheck of $ 20 million a year.

Sorry jpark this crisis proves that free unregulated markets can not be trusted, and should never be trusted, and they will never be trusted again.

You may call it government interference, but I call it regulation. It is lack of regulation that has caused this, and a lack of accountability of the US government will prolong it.

If not now then when will you accept that the American Laz a faire capitalist system is as dead as the Soviet Union. America has 7 years to pay off its debts or it will be insolvent. Where is that money going to come from? Who is going to buy 10 trillion USD over the next 5 years? What does America have left to sell worth 10 trillion USD ?

The very best America can hope for is to bail out the banks so they can guarantee their foreign holdings to companies like HSBC, ICBC and UBS and pray to G.O.D. the world takes pity on you.

Its time to pay the piper, America made its choices and it chose badly, there are no second chances, you must live with your decisions, and to quote Wall st, "Thats the bottom line"

SthPacific,

You confuse the financial institutions and investors with Americans. The average American did not loan money to people who could not pay. The average American did not create a credit instrument which was guaranteed to cause default. The average American did not foreclose on his creditors and then complain about the foreclosures.

The federal government encouraged financial institutions to relax credit and extend credit to people who could not pay. The financial institutions (not all of them) were happy to comply and reaped massive profits. Investors also saw an opportunity for profit and bought and traded overpriced paper.

Let the financial institutions who played with fire get singed. Let the investors who bought and sold overvalued paper lose on the paper they bought but failed to sell.

Let the average American get on with his life without robbing him further.

No this will not happen, You cant just sell a bunch of dodgy debt as a package off on the international market that was clearly fraudulent and expect to get away with it, I dont care if you think this is fair, or if you were in any way responsible. It is your government and it is supposedly a democracy, so you are responsible for the actions of this institution. Just as any other country would be. Do you think that US armed forces cared a hoot about Saddam Husseins tea lady when they tossed here out on the street with not two pennies to rub together during de-bathhification, No ofcourse not, 

300 million people owe the world at least 6 trillion USD and they are going to have to pay, or NO MORE CREDIT ever !! Look at how low wages are in the US, if you dont have credit and you have to pay cash for all the oil the USA uses, how long do you think you could hold out with gasoline at 12$ a gallon ? if you can get it. 

 The average American did not foreclose on his creditors and then complain about the foreclosures. 

The average American re-mortgaged their house and then blew the cash on Chinese imports, now the value of that house has fallen by 16% so they default, The Government privatized pension funds 401k's so the banks have no savings, thats 50% of there income gone, all because greedy Americans believed in some myth about private enterprise and wanted to make a few dollars more. 

For the average American, its time to pay up, and pay up they will, no more 401k, no more credit cards, no more easy home loans, with no money down, 10% deposit minimum, and 8 $ a gallon gasoline, and thats the best you'll get, try and revive this failed system, and I assure you it will be much worse than that. 

SthPacific,

You cant just sell a bunch of dodgy debt as a package off on the international market that was clearly fraudulent and expect to get away with it, I dont care if you think this is fair, or if you were in any way responsible.

I did not sell a bunch of dodgy debt on the international market. The federal government did not sell a bunch of dodgy debt on the international market.

People in the U.S. and everywhere else in the world buy and sell on the stock exchanges. Everyone who plays the market is responsible for his/her own choices.

I am not responsible, you are not responsible and the U.S. government is not responsible.

The people who sell are responsible for their sales. The people who buy are responsible for their purchases.

I did not sell a bunch of dodgy debt on the international market. The federal government did not sell a bunch of dodgy debt on the international market.

 You may not be responsible, but you are accountable. So is the US government. If those who are responsible for this mess, cant pay up, then the government will have to bail them out. If the government is unable to do this, and they are unable, then it falls upon the American tax payer to fork out. I am not saying that this is fair or right, it is just the way it is, so you have a choice Pay up or starve. If you do not pay up quickly, and the interest is running at about 2.5% per day, then you will get no more credit. HSBC want there money NOW! Get it. Pay up or no more money. Thats life sunshine, this aint Disneyland its the real world, you made bad decisions, and now you have to pay. Just remember that next time you hear someone praising Ronald Reagan and his Reaganomics. 

SthPacific,

You may not be responsible, but you are accountable. So is the US government.

No and No. When you borrow money, you are responsible for the note. No one else is. When you default, you are accountable, no one else is.I did not borrow the money and I did not default on it. I am neither responsible nor accountable for it. Neither is the U.S. government.

So why is your tax bill going to rise sharply because of this then, Why is the US government giving up all that money they belongs in your communities infrastructure 

Ok you are neither responsible nor accountable for it. Neither is the U.S. government. Who cares.

But you will still have to pay. No matter how you twist and wriggle, its coming out of your pocket. 

accountable |əˈkountəbəl|adjective1 (of a person, organization, or institution) required or expected to justify actions or decisions; responsible : government must be accountable to its citizens | parents could be held accountable for their children's actions. See note at responsible .

The fact that our government wants to seize money from us to give to the investors and banks does not make it right. It is wrong.

It does appear that we will be robbed by our own government in this.

If I was you jpark I would demand that all those 401k's be nationalized too, They must be worth something and I imagine that this is the pool of cash that these banks are looking at robbing. The banks could then borrow against this pool and provided there is not a run of retiree's, it should hold up. Then at the end of your working life, you would at least get something back. 

Bravo! Bravissimo!! Brilliant, Preacher!

Let's break this down Preacher. Of 300,000,000 citizens.Let me use this example. Let us say that 75,000,000 of those are men and 75,000,000 are women,who are married to each other with (2) children in their family. That's 150,000,000 maried people with (2) kids in their household or 300,000,000 citizens. 150 million of them adults and 150 million of them children. You advocate "$1,000,000.00 for each of the citizens "over 18 yo".That's equal to $1,000,000.00 x 150,000,000 citizens who are adults. this amounts to $150,000,000,000,000 or 150 Trillion dollars.
Paying the kids their $150,000 ($150,000 x 150,000,000 kids) would cost 22,500,000,000,000 or 22.5 Trillion dollars for a grand total of 172 Trillion dollars. Translated into billions of dollars that amount equals Twenty Two thousand five hundred (22,500) Billion dollars. 21,800 billion dollars more than the bailout of 700 Billion. Check the math man,check the math.

At least I got your attention. But were going to print it anyway and charge the American people for it. Face it, it's all black and white anyway. When was the last time you took your savings and cashed it in for gold. Realistically, the American people have the alienated right to dictate to their representatives what should be done with 700 Billion dollars. It is not going to generate capital gain for the average American. We will still be trying to pay our bills, our mortgages and whatever other debts that have been incurred. It's pretty darn sad when a presidential nominee can solicit the President to come to my home state, have a dinner with the upper elite, make a mill in a matter of a few hours and leave, while Americans can't even keep food in our pantries, or take care of those less fortunate than ourselves. So what's the difference,172 trillion vs. 700 billion, its all a racket anyway. If a bank won't loan you money and you have your money in that bank, pull it. "Old man Potter" deserves everything that coming to him. (Them)

I just meant -- hahaha...

However, on a more serious note -- since the Congress has announced that they aren't going home until they have approved a "Rescue Package". Well, bravo, especially if that's what it takes to keep America free (note that we currently owe China $500Bn of the $700Bn that is being asked)

but IF IN FACT IT IS TRUE that we also need an economic stimulus for taxpayers, as many are saying, then why wouldn't they agree to stay in session until the whole thing is finished, stimulus included.

If the US printed 172 trillion $ you would have inflation that would make Zimbabwe look like a stable economy. Currently US inflation is over 10% or if you prefer the governments statistics, that assumes Americans dont eat or drive, then its 2%

Surprisingly, there are is an adequate number of Americans not eating or driving now. What planet do you live on? Look around...Americans are fed up with the lies and the burden of debts incurred by people that should have never had this amount of control over the financial system of this Nation. I agree with jpark, I didn't make the debt, I shouldn't be responsible for bailing those smucks out. They should be accountable for their errors, God knows, the average American is held accountable. Bad judgement does not constitute a blank check! And as far as insolvency, realistically, we've been insolvent for quite a long time! What goes around, come around!

Hmmm Looks out the window, no stars and stripes here so Im not from planet debt,

 Nation. I agree with jpark, I didn't make the debt, I shouldn't be responsible for bailing those smucks out.

I agree with you too, but the fact is, you are accountable whether you like it or not. No  HSBC, ICBC and UBS want their money, Pay up now or continue to pay an extra 2.5% per day. If you dont pay you get no more credit. Think of it this way, you just walked out of Disneyland and into the car park, welcome to reality :) Haven't seen yopur kind here for about ooo 25 years 

Hey Leo ~~ And if you wordsmith that first point to read "solvent competent ONSHORE companies, I think you have pretty much summarized much of Barack's economic plan.

Good point about onshore. I'll have to look more into his plans.

I believe you have a very good point. We have invested too much in global economy, it is not what it has been trumped up to be. Americans have depended on commodities and resources from other countries to the end result. The difference between this economic meltdown and the depression, is the American structural foundation. During the depression, Americans were self sufficient for the most part. Today, we are spread across the world in dependency. We need to re-invest in America. Sure, it's gonna cost a pretty penny, know matter how you look at it. But let's keep the money here and stimulate growth and self sufficiency once again.

Nice wish list guys, but unfortunately bailing out "solvent competent ONSHORE companies," is not an option, The US must first cover the losses by foreign holders in this subprime debacle like HSBC, ICBC and UBS. If the US does not do this, there will be no more credit, ever for the US, and the US economy will implode.

This situation can not be fixed, the US Fed will be Audited by the World bank and when that happens next year Ohhh lordy lordy!!!

The real trouble is the debt, this must be paid back by 2017. So the US economy can not last past the third quarter of 2016 no matter what happens. That does not leave much time to come up with a better way of doing things, and I am still not hearing any suggestions from the US, adapt or die, the US Laz a faire system is in the trash can of history, along with the Soviet Union. The longer it takes for Americans to realize this the worse the pain will be.

Go to the well too many times ... and your shares are diluted (Witness what's happened to Ford and GM. They've made so many offerings they're trading in single digits -- a precursor to bankruptcy.)

Surely you jest. Ford, GM? They are in trouble because didn't see the energy crisis coming.

My point is that during times of tight credit, corporations have other options. If they were asleep at the wheel, and didn't have a plan about what to do in a credit crunch, that's just to bad. Their stock was a poor investment to begin with.

I agree with you whole heartily, invest our tax payer dollars in frivolous nonsense, and into countries that would as soon annihilate us than support us. But allow people struck down by tragedy and misfortune in or very own country fend for themselves. There's something terribly wrong with this picture. Then give Wall Street a down payment of 700 Billion. They can write me a check any day. Today would be nice!

But you are forgetting all that credit card debt, all that wasteful consumerism. Did you really think that would just go on forever and you would never have to pay for it ?

This has nothing to do with the bailout, Recapitalizing the banks is what is needed, the bailout did not do this, it just privatized the profits and Nationalized the debt. I dont see how it would have had any effect on the stock markets, as the problem remains, you need to identify which banks are solvent and which are insolvent,. Stupid American laws prevent this from happening. 

Your right spygirl they could come up with a much better plan, but at least 50% of the people would never accept it, because of years and years of brainwashing with platitudes about Free markets, and Capitalism is the American way. 

Its funny to watch from outside the US its like a 1930;'s slap stick comedy with the politicians as the fire brigade in clown suits, rushing to the flaming Wall street, in their comic fire engine, one swing off the ladder at the back. When they arrive all they can do is argue about which fire extinguisher to use, "No No use the gold one not the red one" and "I say No use the red one not the gold one" Its a laugh a minute down there in the White House.