Current US financial Crisis

I dont know about you guys, but following the massive problems going on in Wall Street gives me something to relate to in learning about business practices in my University. The only thing is now all my professors are scaring me because the job market is going to be only more competitive for people like me coming out against skilled workers looking for the same jobs

The similarity of the rush to lend money to people to buy houses whether they could afford them or not resembles the rush to lend money to people to buy shares whether they could afford them or not that marked the 'twenties. The 'twenties stock bubble crashed. The recent housing bubble crashed.

Edited by gcle2003 - 17-Sep-2008 at 15:04

Hello to you all

Unpleasant though it may be, and politically unpalatable as well, the rules of the game may soon be changing for those used to living on credit.

Edited by pikeshot1600 - 17-Sep-2008 at 23:13

Originally posted by pikeshot1600 Evidently AIG will disappear.  The assets will be sold off to satisfy the Fed's loans.  Many of the assets are in good order and will realize much of their value.  Their holdings of garbage mortgage paper will damage the value to current stockholders who will probably be almost wiped out.  Tough; that's the breaks.   The markets seem to be keeping an eye on Washington Mutual, a huge savings bank with enormous exposure to questionable debt.  WaMu may not make it, and that would be another enormous hit to the FDIC and the Treasury.

WaMu is on the auction block. Everyone is merging and trying to shore each other up. The best thing the Fed did was to let Lehman go and give these corp's a good slap. Up until now they were simply treading water and delaying this part of the cycle. HBOS* is also a goner taken over by Lloyds, that bank was the pathetic story of 2008 (re the comedy of its capital raising). This is a gun shot marraige thanks to the UK government not wanting another northern rock

Edited by Leonidas - 18-Sep-2008 at 05:05

The swan song of the capitalistic world, living on tick.

So if a racing punter can't pay off the bookies, the answer is to pay off the bookies so they will go on accepting his bets?

Hi, there,

The problem that I see with Hoover and Bush administration are the ideological blinds that they have with their pop neoliberal theories.

If the Bush administration had quickly created an agency to buy "bad" loans at a discount and refinance subprime mortgages a year or two ago, a lot of this would have been avoided.

Let me stress this point: subprime borrowers could afford the early rates. What killed them were the point where the rates ballooned, after a year or two.

By buying the mortgages at a discount and making the rates affordable, people could stay in their homes reducing the foreclosure rate. Investors interested in real estate securities could buy more secure mortgage products once the chances of people being able to keep paying the mortgage was increased.

This is not a radical program: it was used during the Great Depression.

However, Bush and the GOP only believe in helping the millionaires. This solution didn't occurred to them people, and when liberal economists brought it up, it was quickly dismissed.

Now, I am pessimistic about the ideological blinders of the people involved in the fix. Like the Bush generals, many of these economics have drawn the wrong lessons from history and behave accordingly.

The only hope that I have left is that their understanding of how deep the troubles of the U.S. economy are will shake them out of their ideology and will actually make them ready to use pragmatic solutions. And I hope that it is not too late when they reach that point, if they do.

"None of this would have happened if George W Bush had been alive."

Edited by gcle2003 - 07-Oct-2008 at 19:06