Mar
28
Government Bailouts: Good or Bad for America?
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Shannon Miller asked:
While there is an increased trend in the number of bailouts by the government recently, it is not all that of a new topic. Throughout US history, there have been many government bailouts, beginning in the 1970’s. The only difference is that today, the dollar amount of the bailouts has increased to great proportions. Until the recent hype of the stock market issues and the takeover of Freddie Mac and Fannie Mae, the term bailout was not something Americans used in everyday language. I believe it is due to the high influence of the media these days that bailouts are more widely covered these days along with the decrease in our economic efficiency. These billions and billions of dollars spent on these bailout programs may help the businesses that need it but it must also affect our economy in ways that are not effective.
To explain, a bailout usually comes about to prevent a business from going under because it is believed that the effects of the collapse will be much worse on the economy than to help liquidate the assets until the business can get back onto its feet. The government is most likely the one to fund the bailout, by ways of loans to be repaid once the business is back on its feet. Beginning with the first bailout in our governments’ history, the Penn Central Railroad, at a mere $3.2 billion, it is nothing compared to the recent $700 billion cop out plan to aid in the mortgage crisis. It does not look as if the bailout route will go away anytime soon.
Bailouts come with both advantages and disadvantages but it depends on what kind of market that is being dealt with. Sometimes it is the business owners that make the wrong choices and lead their business into turmoil. Should the mistakes of owners be given these loans in order to get back on track? After leading a business into trouble once, it may very well happen again in the long run. It is important to wonder if the inevitable is being delayed or the business actually has some chance of getting back on track. Even so, the executives of the collapsing businesses are usually the ones at the advantage when it comes around to a bailout. Making wrong choices should have to be dealt with, and not rewarded. Rewarding these bad business decisions does not provide an incentive to make the correct decisions.
Another problem raised is the amount of government involvement in the business world. The United States rests on a laissez-faire system, in order to keep government and business separate entities. Bailouts may raise some disagreement as to whether the government funding these programs is becoming too involved. Also in the same spectrum, the National Reserve has created a very high amount of liquidity and a very easy going policy. Interest rates are at a very low rate, which has not helped with the housing crisis. The most recent collapse of Fannie Mae and Freddie Mac has negatively affected the economy due to people being enticed into purchasing mortgages and homes they were unable to afford, which they eventually lost. People have been engaging in much riskier behavior due to this debacle and the bailouts encourage this to go on.
On the other hand, bailouts in the auto industry can have a good effect on our economy. By helping out an American company, it keeps production inside the country to keep up the skills of the people in the country and keep it secure as a nation.
Overall, government bailouts may seem like a good or a bad idea depending on the issue at hand. The government must make sure that it is not getting too involved and also that it is creating good policies to stimulate our economy. Bailouts should not be used as a form of a way out of bad decisions, as this motivates bad decisions to keep happening and having a belief that they can always fall back on taxpayer’s money in order to be rescued. If bailouts continue to increase as they have been, I don’t believe the economy will get back on track like we need it to.
Leo
While there is an increased trend in the number of bailouts by the government recently, it is not all that of a new topic. Throughout US history, there have been many government bailouts, beginning in the 1970’s. The only difference is that today, the dollar amount of the bailouts has increased to great proportions. Until the recent hype of the stock market issues and the takeover of Freddie Mac and Fannie Mae, the term bailout was not something Americans used in everyday language. I believe it is due to the high influence of the media these days that bailouts are more widely covered these days along with the decrease in our economic efficiency. These billions and billions of dollars spent on these bailout programs may help the businesses that need it but it must also affect our economy in ways that are not effective.
To explain, a bailout usually comes about to prevent a business from going under because it is believed that the effects of the collapse will be much worse on the economy than to help liquidate the assets until the business can get back onto its feet. The government is most likely the one to fund the bailout, by ways of loans to be repaid once the business is back on its feet. Beginning with the first bailout in our governments’ history, the Penn Central Railroad, at a mere $3.2 billion, it is nothing compared to the recent $700 billion cop out plan to aid in the mortgage crisis. It does not look as if the bailout route will go away anytime soon.
Bailouts come with both advantages and disadvantages but it depends on what kind of market that is being dealt with. Sometimes it is the business owners that make the wrong choices and lead their business into turmoil. Should the mistakes of owners be given these loans in order to get back on track? After leading a business into trouble once, it may very well happen again in the long run. It is important to wonder if the inevitable is being delayed or the business actually has some chance of getting back on track. Even so, the executives of the collapsing businesses are usually the ones at the advantage when it comes around to a bailout. Making wrong choices should have to be dealt with, and not rewarded. Rewarding these bad business decisions does not provide an incentive to make the correct decisions.
Another problem raised is the amount of government involvement in the business world. The United States rests on a laissez-faire system, in order to keep government and business separate entities. Bailouts may raise some disagreement as to whether the government funding these programs is becoming too involved. Also in the same spectrum, the National Reserve has created a very high amount of liquidity and a very easy going policy. Interest rates are at a very low rate, which has not helped with the housing crisis. The most recent collapse of Fannie Mae and Freddie Mac has negatively affected the economy due to people being enticed into purchasing mortgages and homes they were unable to afford, which they eventually lost. People have been engaging in much riskier behavior due to this debacle and the bailouts encourage this to go on.
On the other hand, bailouts in the auto industry can have a good effect on our economy. By helping out an American company, it keeps production inside the country to keep up the skills of the people in the country and keep it secure as a nation.
Overall, government bailouts may seem like a good or a bad idea depending on the issue at hand. The government must make sure that it is not getting too involved and also that it is creating good policies to stimulate our economy. Bailouts should not be used as a form of a way out of bad decisions, as this motivates bad decisions to keep happening and having a belief that they can always fall back on taxpayer’s money in order to be rescued. If bailouts continue to increase as they have been, I don’t believe the economy will get back on track like we need it to.
Leo
Mar
23
Retail Bailouts & Bankruptcies
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Ernie Fitzpatrick asked:
Now that the financial institutions have received all of their pre Christmas bailout money and now that the automobile industry is getting a down payment on their billions, with Christmas over, is it time for the retailers to get their share of the hand outs, bailouts, or whatever you want to call them? After all, Christmas is 30-50% of some retailers entire year sales.
U.S. retailers face a wave of store closings, bankruptcies and takeovers starting next month as holiday sales are shaping up to be the worst in 40 years. Retailers may close 73,000 stores in the first half of 2009, according to the International Council of Shopping Centers. You read that right! 73,000 stores may close!
More unemployment.
More than a dozen retailers, including Circuit City Stores Inc., Linens ‘n Things Inc., Sharper Image Corp. and Steve & Barry’s LLC, have sought bankruptcy protection this year as the credit squeeze and recession drained sales. Investors will start seeing a wide variety of chains seeking bankruptcy protection in February when they file financial reports, said Burt Flickinger.
“You’ll see department stores, specialty stores, discount stores, grocery stores, drugstores, major chains either multi- regionally or nationally go out,” Flickinger, managing director of Strategic Resource Group, a retail-industry consulting firm in New York, said today in a Bloomberg Radio interview. “There are a number that are real causes for concern.”
Retail Metrics Inc.’s December comparable-store sales index will drop an estimated 1.2 percent, or 5 percent excluding Wal- Mart Stores Inc. Retailers’ fourth-quarter earnings may fall 19% on average, the seventh consecutive quarterly decline, according to Ken Perkins, president of Retail Metrics, a Swampscott, Massachusetts-based consulting firm.
This is dire news no matter how you cut it.
Probably 50,000 stores could close without any effect on consumer choice, Gregory Segall, a managing partner at buyout firm Versa Capital Management Inc., said this month during a panel discussion held at Bloomberg LP’s New York offices. Only retailers with healthy balance sheets will survive the recession, according to Matthew Katz, a managing director at consulting firm AlixPartners LLP.
I bet Obama can’t wait to get back to the mainland to begin solving all of these bankruptcy problems. Oh yes, and the war in the Middle East between Israel and Hamas.
Calvin
Now that the financial institutions have received all of their pre Christmas bailout money and now that the automobile industry is getting a down payment on their billions, with Christmas over, is it time for the retailers to get their share of the hand outs, bailouts, or whatever you want to call them? After all, Christmas is 30-50% of some retailers entire year sales.
U.S. retailers face a wave of store closings, bankruptcies and takeovers starting next month as holiday sales are shaping up to be the worst in 40 years. Retailers may close 73,000 stores in the first half of 2009, according to the International Council of Shopping Centers. You read that right! 73,000 stores may close!
More unemployment.
More than a dozen retailers, including Circuit City Stores Inc., Linens ‘n Things Inc., Sharper Image Corp. and Steve & Barry’s LLC, have sought bankruptcy protection this year as the credit squeeze and recession drained sales. Investors will start seeing a wide variety of chains seeking bankruptcy protection in February when they file financial reports, said Burt Flickinger.
“You’ll see department stores, specialty stores, discount stores, grocery stores, drugstores, major chains either multi- regionally or nationally go out,” Flickinger, managing director of Strategic Resource Group, a retail-industry consulting firm in New York, said today in a Bloomberg Radio interview. “There are a number that are real causes for concern.”
Retail Metrics Inc.’s December comparable-store sales index will drop an estimated 1.2 percent, or 5 percent excluding Wal- Mart Stores Inc. Retailers’ fourth-quarter earnings may fall 19% on average, the seventh consecutive quarterly decline, according to Ken Perkins, president of Retail Metrics, a Swampscott, Massachusetts-based consulting firm.
This is dire news no matter how you cut it.
Probably 50,000 stores could close without any effect on consumer choice, Gregory Segall, a managing partner at buyout firm Versa Capital Management Inc., said this month during a panel discussion held at Bloomberg LP’s New York offices. Only retailers with healthy balance sheets will survive the recession, according to Matthew Katz, a managing director at consulting firm AlixPartners LLP.
I bet Obama can’t wait to get back to the mainland to begin solving all of these bankruptcy problems. Oh yes, and the war in the Middle East between Israel and Hamas.
Calvin
Mar
20
How to Protect yourself From the Bailout….er, Rescue Plan
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Nancy Nuce asked:
For weeks, we have been bombarded by the media coverage of the so-called economic “bailout”.
No one could explain exactly what this plan was. All they would tell us was that it was “necessary”. They kept trying to tell us that, no, no, they weren’t “bailing out” Wall Street. They were preventing an economic collapse, but no one could explain how that was going to work.
After the House of Representatives voted down the first version, some of those trying to ram it through began to call it a “rescue plan”. They began to use scare tactics. They told us that unless this plan passed, we would all be in deep trouble.
They said that unless it passed, regular people would not be able to get a loan to buy a house. We would not be able to buy a car. Our credit cards would be cancelled, or at the very least, our credit limits would be lowered.
They said that our employers would not be able to get loans to pay our paychecks - that people would lose their jobs.
So, our Congress, not wanting to be blamed for that disaster, passed the plan. Now, we await the fallout.
They are attempting to reassure us that we will not be affected by this, they are going to make it pay for itself.
Yeah, right.
Does anyone actually believe that we, the taxpayers, will not be adversely affected by this fallout? I think not.
No matter what they call it, bailout or rescue plan, it is going to cost a minimum of $700 BILLION dollars - IF they come in on budget. I ask you, when was the last time the government did ANYTHING that came in on budget?
The average working class family currently makes less than $50,000 per year. That means that this plan will cost - at least - the entire yearly salary of more than 14 MILLION families! And make no bones about it, it WILL be the average working class family who will end up paying the price. (What, you thought that the guys making the big bucks were going to pay?)
But all is not lost. You CAN protect yourself from these well-meaning politicians and the plan that they claim to have passed for your own good.
The answer is to bailout yourself by accumulating as much tax-free money as you possibly can, as soon as you can. That way if they decide to tax your hard-earned paycheck, you will have a cushion to fall back on.
The best way I have found to do this is with a cash gifting program. The premise is simple, it’s easy to do. Because you are receiving gifts - not selling something - the IRS and Social Security do not consider it “income”. Therefore, you pay no tax - according to my accountant.
But don’t take my word for it. I can’t begin to explain it properly. I’m not an expert or even a salesperson or a tax accountant. I’m just a regular person who is receiving money.
Get the full explanation and all of the information you need to get started at my website
Sheila
For weeks, we have been bombarded by the media coverage of the so-called economic “bailout”.
No one could explain exactly what this plan was. All they would tell us was that it was “necessary”. They kept trying to tell us that, no, no, they weren’t “bailing out” Wall Street. They were preventing an economic collapse, but no one could explain how that was going to work.
After the House of Representatives voted down the first version, some of those trying to ram it through began to call it a “rescue plan”. They began to use scare tactics. They told us that unless this plan passed, we would all be in deep trouble.
They said that unless it passed, regular people would not be able to get a loan to buy a house. We would not be able to buy a car. Our credit cards would be cancelled, or at the very least, our credit limits would be lowered.
They said that our employers would not be able to get loans to pay our paychecks - that people would lose their jobs.
So, our Congress, not wanting to be blamed for that disaster, passed the plan. Now, we await the fallout.
They are attempting to reassure us that we will not be affected by this, they are going to make it pay for itself.
Yeah, right.
Does anyone actually believe that we, the taxpayers, will not be adversely affected by this fallout? I think not.
No matter what they call it, bailout or rescue plan, it is going to cost a minimum of $700 BILLION dollars - IF they come in on budget. I ask you, when was the last time the government did ANYTHING that came in on budget?
The average working class family currently makes less than $50,000 per year. That means that this plan will cost - at least - the entire yearly salary of more than 14 MILLION families! And make no bones about it, it WILL be the average working class family who will end up paying the price. (What, you thought that the guys making the big bucks were going to pay?)
But all is not lost. You CAN protect yourself from these well-meaning politicians and the plan that they claim to have passed for your own good.
The answer is to bailout yourself by accumulating as much tax-free money as you possibly can, as soon as you can. That way if they decide to tax your hard-earned paycheck, you will have a cushion to fall back on.
The best way I have found to do this is with a cash gifting program. The premise is simple, it’s easy to do. Because you are receiving gifts - not selling something - the IRS and Social Security do not consider it “income”. Therefore, you pay no tax - according to my accountant.
But don’t take my word for it. I can’t begin to explain it properly. I’m not an expert or even a salesperson or a tax accountant. I’m just a regular person who is receiving money.
Get the full explanation and all of the information you need to get started at my website
Sheila
Mar
18
Citibank (citigroup) Bailout?
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Ernie Fitzpatrick asked:
So, the big three automakers had to go back to the designing board, draw up some plans that would show long-term viability and get back with Congress December 2nd. If all the hype and plans look good, then you and I (the taxpayers) might loaned them something like $25 BIG ones, as in billions, to tide them over the holidays. Oh yeah, and did you hear that GM reduced their corporate fleet of executive planes from 5 to 3? So, who’s NEXT for a bailout?
Citibank-Citigroup! Do you have the next number? Come on down!
Citigroup has more than $2 trillion of assets, dwarfing companies such as American International Group Inc. that got U.S. support this year. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben S. Bernanke may favor a rescue to avoid the chaotic aftermath of Lehman Brothers Holdings Inc.’s bankruptcy in September. Hey, if AIG deserved a loan, why not Citigroup?
“There is no question that Citi is in the category of ‘too big to fail,’” said Michael Holland, chairman and founder of Holland & Co. in New York, which oversees $4 billion. “There is a commitment from this administration and the next to do what it takes to save Citi.” Really, and is SIZE the minimal requirement for bailout bonds?
While Citigroup executives say the company has adequate capital and liquidity to ride out the crisis, its tumbling share price may shake the confidence of creditors, clients and rating agencies. A similar scenario played out at Lehman, when Chief Executive Officer Richard Fuld declared the firm was “on the right track” five days before the firm went bankrupt. Citigroup stock is now trading below $4 a share. Who would have ever thought we’d see 1,028,692,888 shares traded as we did last Friday?
Friday’s close was $3.77, down 0.94 a share or down 19.96% Not a pretty picture.
Citigroup CEO Vikram Pandit told employees today that he doesn’t plan to break up the company, aiming to reassure workers as the stock resumed its skid. Pandit and Chief Financial Officer Gary Crittenden, speaking on a worldwide conference call this morning, also said they don’t expect to sell the Smith Barney brokerage unit, according to two people who listened to the call and declined to be identified because it wasn’t open to the public.
Isn’t that the same kind of assurances we got from AIG, Freddie Mac, and Fannie Mae……………just before being bailed out by you and I- the taxpayers?
Herman
So, the big three automakers had to go back to the designing board, draw up some plans that would show long-term viability and get back with Congress December 2nd. If all the hype and plans look good, then you and I (the taxpayers) might loaned them something like $25 BIG ones, as in billions, to tide them over the holidays. Oh yeah, and did you hear that GM reduced their corporate fleet of executive planes from 5 to 3? So, who’s NEXT for a bailout?
Citibank-Citigroup! Do you have the next number? Come on down!
Citigroup has more than $2 trillion of assets, dwarfing companies such as American International Group Inc. that got U.S. support this year. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben S. Bernanke may favor a rescue to avoid the chaotic aftermath of Lehman Brothers Holdings Inc.’s bankruptcy in September. Hey, if AIG deserved a loan, why not Citigroup?
“There is no question that Citi is in the category of ‘too big to fail,’” said Michael Holland, chairman and founder of Holland & Co. in New York, which oversees $4 billion. “There is a commitment from this administration and the next to do what it takes to save Citi.” Really, and is SIZE the minimal requirement for bailout bonds?
While Citigroup executives say the company has adequate capital and liquidity to ride out the crisis, its tumbling share price may shake the confidence of creditors, clients and rating agencies. A similar scenario played out at Lehman, when Chief Executive Officer Richard Fuld declared the firm was “on the right track” five days before the firm went bankrupt. Citigroup stock is now trading below $4 a share. Who would have ever thought we’d see 1,028,692,888 shares traded as we did last Friday?
Friday’s close was $3.77, down 0.94 a share or down 19.96% Not a pretty picture.
Citigroup CEO Vikram Pandit told employees today that he doesn’t plan to break up the company, aiming to reassure workers as the stock resumed its skid. Pandit and Chief Financial Officer Gary Crittenden, speaking on a worldwide conference call this morning, also said they don’t expect to sell the Smith Barney brokerage unit, according to two people who listened to the call and declined to be identified because it wasn’t open to the public.
Isn’t that the same kind of assurances we got from AIG, Freddie Mac, and Fannie Mae……………just before being bailed out by you and I- the taxpayers?
Herman
Mar
15
Your Mortgage and the Government Bailout
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Chad Fisher asked:
The United States is currently in the middle of a mortgage crisis. Foreclosures on mortgaged homes are at an all time high, and predictions say that billions of dollars of wealth will have been lost before its through. The effects of the crisis are being felt on all levels – aside from people facing foreclosures on their homes, many lenders have gone bankrupt. Finally, the government has decided to step in and provide some relief to lenders and borrowers alike. But the question is, just how will this government bailout affect a person’s mortgage?
What this bailout plan does is, unfortunately, pretty limited. It won’t help out everyone. What the bailout does on the level of the individual borrower is to freeze the borrower’s mortgage for five years. This keeps the interest rate of the mortgage down for a period of time so that the borrower can get their finances in order and dig themselves out of their situation. Unfortunately, there are a couple of stipulations on this program.
The first stipulation is that it only applies to people who have less than 3% equity on their homes. People with higher equity are simply out of luck. The second qualification is that the borrower must be no more than 60 days late paying their mortgage. Needless to say, for people who are already in severe trouble and have been missing payments aren’t helped at all by this.
In addition to the above qualifications a buyer would have to prove that he or she couldn’t afford increased interest in their mortgage. The government buyout plan also only applies to subprime mortgages – but there are many people struggling with prime mortgages who face financial difficulties, too. Unfortunately, this leaves a lot of people who were looking for a little relief out of luck.
The ultimate problem with this bailout program is that it only serves to delay inevitable outcome. The bottom line is that if you are living in a home that you can’t afford to live in, even if the government bailout helps you, you may still find yourself in trouble. Unless a significant financial change or a reduction in the interest rate or principle is in the wings, you chances are at the end of the five-year freeze you still won’t be in a good place.
Another perceived problem with the government bailout program is that it works to reinforce the behavior that put the housing market in the crisis it faces today. Subprime lending encouraged people to try and buy houses that they couldn’t really afford, and the bailout program is helping those same people. Meanwhile, people who had made smart choices about buying a home, but faced some other financial problem are left high and dry.
The unfortunate bottom line is that if you can’t pay your mortgage, chances are that the government bailout isn’t going to save you from foreclosure. Unless you have good reason to believe there’ll be a change in your financial fortune, it may be time to start preparing for the worst.
Corey
The United States is currently in the middle of a mortgage crisis. Foreclosures on mortgaged homes are at an all time high, and predictions say that billions of dollars of wealth will have been lost before its through. The effects of the crisis are being felt on all levels – aside from people facing foreclosures on their homes, many lenders have gone bankrupt. Finally, the government has decided to step in and provide some relief to lenders and borrowers alike. But the question is, just how will this government bailout affect a person’s mortgage?
What this bailout plan does is, unfortunately, pretty limited. It won’t help out everyone. What the bailout does on the level of the individual borrower is to freeze the borrower’s mortgage for five years. This keeps the interest rate of the mortgage down for a period of time so that the borrower can get their finances in order and dig themselves out of their situation. Unfortunately, there are a couple of stipulations on this program.
The first stipulation is that it only applies to people who have less than 3% equity on their homes. People with higher equity are simply out of luck. The second qualification is that the borrower must be no more than 60 days late paying their mortgage. Needless to say, for people who are already in severe trouble and have been missing payments aren’t helped at all by this.
In addition to the above qualifications a buyer would have to prove that he or she couldn’t afford increased interest in their mortgage. The government buyout plan also only applies to subprime mortgages – but there are many people struggling with prime mortgages who face financial difficulties, too. Unfortunately, this leaves a lot of people who were looking for a little relief out of luck.
The ultimate problem with this bailout program is that it only serves to delay inevitable outcome. The bottom line is that if you are living in a home that you can’t afford to live in, even if the government bailout helps you, you may still find yourself in trouble. Unless a significant financial change or a reduction in the interest rate or principle is in the wings, you chances are at the end of the five-year freeze you still won’t be in a good place.
Another perceived problem with the government bailout program is that it works to reinforce the behavior that put the housing market in the crisis it faces today. Subprime lending encouraged people to try and buy houses that they couldn’t really afford, and the bailout program is helping those same people. Meanwhile, people who had made smart choices about buying a home, but faced some other financial problem are left high and dry.
The unfortunate bottom line is that if you can’t pay your mortgage, chances are that the government bailout isn’t going to save you from foreclosure. Unless you have good reason to believe there’ll be a change in your financial fortune, it may be time to start preparing for the worst.
Corey
Mar
15
Daniel Imperato Offers 10-point Peoples Program in Lieu of the Proposed Wall St. Bailout
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Joseph Oddo asked:
West Palm Beach, FL – – Former Independent presidential candidate Daniel Imperato speaks out in our second interview about the so-called Washington bailout. Though marginalized and blacked out by the major media, tracing his words from the last three years of campaigning will show just how accurate this international businessman has been.
Long before our elected officials in congress and the administration even recognized the problems, Imperato was offering solutions for Iraq, the Palestinian/Israeli conflict, Yemen, relations with China, South America and, of special concern this week, the derivatives market.
Imperato called himself the People’s President 2008, and developed a website using that name. Now he offers a solution to the proposed bailout with specific long-term goals for correcting the economic woes in the global financial sector. Because in his words, “what ails America will eventually effect the rest of the global markets.”
His ten point program for the bailout package begins with an absolute reduction in salary for executives running the operation that receives benefits from the government. Imperato offers his own services to help the country and the government to administer the program at a reasonable rate of compensation. And he challenges other qualified businessmen to do the same. “Let’s put the country first and get out of this fiasco for a fraction of what our elected officials are proposing. We should only earn conservative salaries and bonuses based on success or failure.”
The complete 10-point plan listed below also includes a provision to truly putting the “people of the United States first. In it he calls for buying American, bringing back jobs that were shipped overseas and taxing foreign visitors to raise nearly $3 billion.
Here is the plan:
1. Reduce salary for executives running any operation receiving benefits from the government.
2. Audit foreign banks that participate in purchasing/refinancing or distributing mortgage-backed securities and/or derivatives to ensure they are in compliance with US regulations before one penny is allocated to them.
3. Any foreign bank that breaches US security law, hyper-inflates their balance sheets, or used mortgage-backed securities/derivatives to further enhance their balance sheets then sell off at a discount to create cash-flow should not be entitled to any US taxpayer funds for this bailout.
4. Banks and financial institutions must immediately recognize old usury laws and stop gouging the American people’s pocketbooks with exorbitant interest rates and fees on credit cards.
5. Allow American families to buy distressed real estate and homes directly from the banks with the federal government using these proposed set aside funds to provide a fixed mortgage rate of 3% per year. Also allow current mortgage holders to refinance to obtain the 3% rate and extend the mortgage term to 50 years. These provisions will reduce monthly payments and directly help families struggling to meet housing payments as the cost of living increases for food and fuel.
6. Banks participating in the US program will immediately stop ATM charges, overdraft charges and bad check fees that are related to banks holding people’s money and not making it available from an institution floating the funds for additional interest.
7. The banks should also eliminate charges for minimum balance requirements and charges related to the number of checks written per month.
8. America needs to start buying American again. 3% fixed rate for all US made automobiles. That’s those made by the big three Chrysler, GM and Ford.
9. Implement a taxing mechanism that would tax US corporations for each and every job they ship overseas. Corporations would have the opportunity to recover taxes paid once jobs are brought back to our soil. Examples of specific job categories include credit card processing, call centers and airline reservation systems.
10. Charge $25 for each foreign traveler arriving and departing US. Estimated revenue from the approximately 57 million international visitors traveling to the US in 2007 would reach nearly $3 Billion.
Following up on his proposed Imperato offered these words, “Foreign banks need to get in line, not receive any funds to save their failing organizations until US based corporate interests are secure and satisfied with bailout package. Even the amount proposed is not big enough to accommodate foreign interests when it is really designed to protect the people of the United States.
“Since it is supposed to be a republic of the people, then we need a bottom up approach. We start right in consumers’ wallets and give them immediate breaks on the outrageous credit card rates so they can afford the monthly payments and food on their table.
“This package should really be a refund and loan program for home buyers. Having already lost value and most facing rising interest rates, the fixed rate of three percent keep troubled families in their homes and allows more Americans to buy distressed real estate and homes. The people should be buying these homes, not the federal government. Longer mortgage terms also reduce monthly payments and directly helps families handle their basic housing needs while juggling the cost of living increases for food and fuel.
“The 50-year low interest loans have been proven successful by the Japanese where their real estate market is based on a 99-year lease because of the shortage of real estate in the major cities.
“I release this today just as the two major party candidates are preparing to debate. Listen closely to what they offer because neither will suggest points as practical as those I have presented. Exactly why America should have the right to allow major-minor party candidates in the debate. I have independent candidates for both congress and president endorsing my plan. Now if we can just get Administration and federal government advisors to listen, it will be an enormous benefit to the people of the United States.
“Before you bail out the top with blank checks you need to insure the bottom – representing the people – that once we implement these points the people will really and truly put money in their pockets. Financially healthy homeowners protect the economy with cash-flow and maintain the strength of the USA for the people regardless of governments influence.”
Imperato admitted to being guilty when it comes to buying American. “Instead of bailing out the auto industry, they need to work closely with unions and find ways to offer American made cars as inexpensive as possible. The 3% fixed rate for all US made automobiles will put more American made cars on the road and help turnaround the economy in especially hard-hit areas like Michigan.”
Of course in the first debate between the big two party nominees, neither gentleman mentioned any of the points that Mr. Imperato has outlined. The question then remains, why shouldn’t those who succeeded in earning ballot positions on enough state ballots to mathematically earn a winning number of Electoral College votes should be permitted to present their ideas to the American voters over the public airwaves?
Joseph Oddo is a freelance writer and director of Independent America.org advocating for a National Election Reform Platform. E-mail him at usrepublic@aol.com.
Alexander
West Palm Beach, FL – – Former Independent presidential candidate Daniel Imperato speaks out in our second interview about the so-called Washington bailout. Though marginalized and blacked out by the major media, tracing his words from the last three years of campaigning will show just how accurate this international businessman has been.
Long before our elected officials in congress and the administration even recognized the problems, Imperato was offering solutions for Iraq, the Palestinian/Israeli conflict, Yemen, relations with China, South America and, of special concern this week, the derivatives market.
Imperato called himself the People’s President 2008, and developed a website using that name. Now he offers a solution to the proposed bailout with specific long-term goals for correcting the economic woes in the global financial sector. Because in his words, “what ails America will eventually effect the rest of the global markets.”
His ten point program for the bailout package begins with an absolute reduction in salary for executives running the operation that receives benefits from the government. Imperato offers his own services to help the country and the government to administer the program at a reasonable rate of compensation. And he challenges other qualified businessmen to do the same. “Let’s put the country first and get out of this fiasco for a fraction of what our elected officials are proposing. We should only earn conservative salaries and bonuses based on success or failure.”
The complete 10-point plan listed below also includes a provision to truly putting the “people of the United States first. In it he calls for buying American, bringing back jobs that were shipped overseas and taxing foreign visitors to raise nearly $3 billion.
Here is the plan:
1. Reduce salary for executives running any operation receiving benefits from the government.
2. Audit foreign banks that participate in purchasing/refinancing or distributing mortgage-backed securities and/or derivatives to ensure they are in compliance with US regulations before one penny is allocated to them.
3. Any foreign bank that breaches US security law, hyper-inflates their balance sheets, or used mortgage-backed securities/derivatives to further enhance their balance sheets then sell off at a discount to create cash-flow should not be entitled to any US taxpayer funds for this bailout.
4. Banks and financial institutions must immediately recognize old usury laws and stop gouging the American people’s pocketbooks with exorbitant interest rates and fees on credit cards.
5. Allow American families to buy distressed real estate and homes directly from the banks with the federal government using these proposed set aside funds to provide a fixed mortgage rate of 3% per year. Also allow current mortgage holders to refinance to obtain the 3% rate and extend the mortgage term to 50 years. These provisions will reduce monthly payments and directly help families struggling to meet housing payments as the cost of living increases for food and fuel.
6. Banks participating in the US program will immediately stop ATM charges, overdraft charges and bad check fees that are related to banks holding people’s money and not making it available from an institution floating the funds for additional interest.
7. The banks should also eliminate charges for minimum balance requirements and charges related to the number of checks written per month.
8. America needs to start buying American again. 3% fixed rate for all US made automobiles. That’s those made by the big three Chrysler, GM and Ford.
9. Implement a taxing mechanism that would tax US corporations for each and every job they ship overseas. Corporations would have the opportunity to recover taxes paid once jobs are brought back to our soil. Examples of specific job categories include credit card processing, call centers and airline reservation systems.
10. Charge $25 for each foreign traveler arriving and departing US. Estimated revenue from the approximately 57 million international visitors traveling to the US in 2007 would reach nearly $3 Billion.
Following up on his proposed Imperato offered these words, “Foreign banks need to get in line, not receive any funds to save their failing organizations until US based corporate interests are secure and satisfied with bailout package. Even the amount proposed is not big enough to accommodate foreign interests when it is really designed to protect the people of the United States.
“Since it is supposed to be a republic of the people, then we need a bottom up approach. We start right in consumers’ wallets and give them immediate breaks on the outrageous credit card rates so they can afford the monthly payments and food on their table.
“This package should really be a refund and loan program for home buyers. Having already lost value and most facing rising interest rates, the fixed rate of three percent keep troubled families in their homes and allows more Americans to buy distressed real estate and homes. The people should be buying these homes, not the federal government. Longer mortgage terms also reduce monthly payments and directly helps families handle their basic housing needs while juggling the cost of living increases for food and fuel.
“The 50-year low interest loans have been proven successful by the Japanese where their real estate market is based on a 99-year lease because of the shortage of real estate in the major cities.
“I release this today just as the two major party candidates are preparing to debate. Listen closely to what they offer because neither will suggest points as practical as those I have presented. Exactly why America should have the right to allow major-minor party candidates in the debate. I have independent candidates for both congress and president endorsing my plan. Now if we can just get Administration and federal government advisors to listen, it will be an enormous benefit to the people of the United States.
“Before you bail out the top with blank checks you need to insure the bottom – representing the people – that once we implement these points the people will really and truly put money in their pockets. Financially healthy homeowners protect the economy with cash-flow and maintain the strength of the USA for the people regardless of governments influence.”
Imperato admitted to being guilty when it comes to buying American. “Instead of bailing out the auto industry, they need to work closely with unions and find ways to offer American made cars as inexpensive as possible. The 3% fixed rate for all US made automobiles will put more American made cars on the road and help turnaround the economy in especially hard-hit areas like Michigan.”
Of course in the first debate between the big two party nominees, neither gentleman mentioned any of the points that Mr. Imperato has outlined. The question then remains, why shouldn’t those who succeeded in earning ballot positions on enough state ballots to mathematically earn a winning number of Electoral College votes should be permitted to present their ideas to the American voters over the public airwaves?
Joseph Oddo is a freelance writer and director of Independent America.org advocating for a National Election Reform Platform. E-mail him at usrepublic@aol.com.
Alexander
Mar
11
Will the Auto Executives use the bailout money for a Luxury vacation?
Filed Under bailout | 2 Comments
smarties28 asked:
AIG executives went on a luxury vacation after they secured their bailout. After the Auto executives twist Obama’s hand and con congress into giving them money how long will it take for them to go on a luxury vacation?
AIG executives went on a luxury vacation after they secured their bailout. After the Auto executives twist Obama’s hand and con congress into giving them money how long will it take for them to go on a luxury vacation?
Which luxury resort will they go to?
Valerie
Mar
10
What is happening to the bailout money?
Filed Under bailout | 2 Comments
Brian M asked:
I get so mad when i see what happens to our bail out money. It just infuriates me to no end. This super bowl Bank of America had a 20mil party and we gave them 40billion of the bailout money. What are these people doing with our tax dollars/ The economy is in shambles and there throwing expensive parties and buying jets. Its terrible. I would love your take on the situations of all the business being corrupt.
Bernice
I get so mad when i see what happens to our bail out money. It just infuriates me to no end. This super bowl Bank of America had a 20mil party and we gave them 40billion of the bailout money. What are these people doing with our tax dollars/ The economy is in shambles and there throwing expensive parties and buying jets. Its terrible. I would love your take on the situations of all the business being corrupt.
Bernice
Mar
9
Presidential Homeowner Bailout
Filed Under bailout | Comments Off
Lynn Bulmer asked:
The effects of the bail out strategy may finally filter down to American homeowners. President Obama\’s recent conference in Phoenix outlined a plan for providing relief to millions of people facing a home foreclosure, stabilizing the housing market and possibly driving down interest rates.
The biggest area of concern was for the people who were enticed into mortgages with low interest rates, only to increase at a later date. Now they are saddled with payments they cannot afford, and may also have lost their jobs.
The second group includes over 10 million households who cannot afford their monthly payments, but whose homes are now worth less than their mortgage.
The bailout solution comes in 3 parts:
First, help homeowners refinance to secure more manageable payments. This is part of the $75 billion program that will subsidize reductions to mortgages by reducing the monthly payment to as little as 31 percent of a family\’s gross monthly income. The initial focus will be on those who will undoubtedly lose their homes without intervention; as opposed to concentrating on speculators or multi-home owners.
The second part will give the mortgage companies and homeowners the stimulus they need to rework loans so that the homeowners can afford their payments and the lenders can minimize their loss. The bailout will offer lenders $1,000 up front for every loan reduced to at least 38 percent of the borrower\’s gross monthly income. If borrowers stay on track with their payments, further government incentives may be available.
Other options, would allow them to offer mortgages with less than 20 percent equity, or to waive the private mortgage insurance which adds hundreds of dollars to a monthly mortgage payment.
The lender can decide how to reduce the payments, but if they determine that these actions supersede the cost of foreclosing, then the borrower may still lose the property.
The third part intends to increase available credit by providing $200 billion in financial support to Fannie Mae and Freddie Mac to encourage them to invest in mortgages and mortgage securities.
Since not everyone cannot be helped, this approach is also dependent on a portion of the over extended homeowners just walking away. If there is a mass exodus of homes abandoned (as little as 10 percent), this could lead to a bigger housing crisis, which would in turn lead to a bigger bailout in the future
Republican lawmakers raised the concern that the plan provides compensation to banks that never should have issued mortgages to unstable borrowers in the first place. In addition, certain homeowners obtained mortgages by falsifying asset statements, and questioned whether they should be eligible for assistance.
Francisco
The effects of the bail out strategy may finally filter down to American homeowners. President Obama\’s recent conference in Phoenix outlined a plan for providing relief to millions of people facing a home foreclosure, stabilizing the housing market and possibly driving down interest rates.
The biggest area of concern was for the people who were enticed into mortgages with low interest rates, only to increase at a later date. Now they are saddled with payments they cannot afford, and may also have lost their jobs.
The second group includes over 10 million households who cannot afford their monthly payments, but whose homes are now worth less than their mortgage.
The bailout solution comes in 3 parts:
First, help homeowners refinance to secure more manageable payments. This is part of the $75 billion program that will subsidize reductions to mortgages by reducing the monthly payment to as little as 31 percent of a family\’s gross monthly income. The initial focus will be on those who will undoubtedly lose their homes without intervention; as opposed to concentrating on speculators or multi-home owners.
The second part will give the mortgage companies and homeowners the stimulus they need to rework loans so that the homeowners can afford their payments and the lenders can minimize their loss. The bailout will offer lenders $1,000 up front for every loan reduced to at least 38 percent of the borrower\’s gross monthly income. If borrowers stay on track with their payments, further government incentives may be available.
Other options, would allow them to offer mortgages with less than 20 percent equity, or to waive the private mortgage insurance which adds hundreds of dollars to a monthly mortgage payment.
The lender can decide how to reduce the payments, but if they determine that these actions supersede the cost of foreclosing, then the borrower may still lose the property.
The third part intends to increase available credit by providing $200 billion in financial support to Fannie Mae and Freddie Mac to encourage them to invest in mortgages and mortgage securities.
Since not everyone cannot be helped, this approach is also dependent on a portion of the over extended homeowners just walking away. If there is a mass exodus of homes abandoned (as little as 10 percent), this could lead to a bigger housing crisis, which would in turn lead to a bigger bailout in the future
Republican lawmakers raised the concern that the plan provides compensation to banks that never should have issued mortgages to unstable borrowers in the first place. In addition, certain homeowners obtained mortgages by falsifying asset statements, and questioned whether they should be eligible for assistance.
Francisco
Mar
4
3 Pros and Cons of a Federal Auto Industry Bailout
Filed Under bailout | Comments Off
Roni Deutch asked:
Pro 1: Eco Cars
If the bailout money works the way it is supposed to and pulls the big three out of the hole, good things could potentially come of it. One proposal is that after being saved the automakers could be pushed to manufacture and sell cars that are both good for the environment and economy.
Con 1: Taxpayer Cash
Perhaps the most obvious con, it is no secret that we will all be helping bail these companies out. Although it is still unknown where the money may or may not come from, taxpayer cash will be included for sure. Bloggers, business leaders, and experts are expressing their frustration about this all over the Internet.
Pro 2: Recession Woes
While most are already feeling the effects of a recession on their wallets and gas tanks, it could be a lot worse if something else “big” happens. Some experts feel not bailing out the big three could result in a much deeper and more severe recession then we are already in. With thousands of jobs connected to the auto companies and stocks across the board, their downfall could have a large effect on our economy.
Con 2: Bankruptcy
One of the only other options for GM and the rest of the big three is to file bankruptcy under chapter 11. It is true that we have already assisted these companies financially this year and it helped them for few months. For this reason, some economists feel another bailout would just be like bailing out a sinking ship that is going to sink no matter what we do. Bankruptcy however, could be their only salvation, and many experts claim that it could be their best option. Michael Levine of the Wall Street Journal claims, “the cost of terminating dealers is only a fraction of what it would cost to rebuild GM to become a company sized and marketed appropriately for its market share. Contracts would have to be bought out. The company would have to shed many of its fixed obligations. Some obligations will be impossible to cut by voluntary agreement. GM will run out of cash and out of time.”
Pro 3: Prior Success
As history tends to repeat itself, I think it important to consider the Chrysler bailout of 1979. In the mid 70’s while our country was going through a gas crisis, Chrysler refused to stop making their biggest most gas guzzling luxury cars. This mistake led them to requesting a bailout in late ‘79. However, to the surprise of the watching country, Chrysler came out with the “K-car” that sold like hot cakes and pulled the company out of a financial crisis. Chrysler then paid off their debt to the government 7 years early, and the government made over $660 million in profit from the bailout when all was said and done. Many people claim that if given another bailout, the auto companies could pull themselves out from near bankruptcy, and the federal government could generate revenue as well.
Con 3: Private Jet-setting
Unfortunately, when the CEO’s of the big three traveled to Washington D.C. to request billions from taxpayers early this week, all three CEO’s took private jets with round trip travel costs totaling of over $40,000 per CEO. This ostentatious show of wealth was considered highly disrespectful to the taxpayers about to consider bailing them out and created tons of bad publicity for the potential bailout. If companies are going to get taxpayer’s money, then we need to know that they are being frugal with it.
April
Pro 1: Eco Cars
If the bailout money works the way it is supposed to and pulls the big three out of the hole, good things could potentially come of it. One proposal is that after being saved the automakers could be pushed to manufacture and sell cars that are both good for the environment and economy.
Con 1: Taxpayer Cash
Perhaps the most obvious con, it is no secret that we will all be helping bail these companies out. Although it is still unknown where the money may or may not come from, taxpayer cash will be included for sure. Bloggers, business leaders, and experts are expressing their frustration about this all over the Internet.
Pro 2: Recession Woes
While most are already feeling the effects of a recession on their wallets and gas tanks, it could be a lot worse if something else “big” happens. Some experts feel not bailing out the big three could result in a much deeper and more severe recession then we are already in. With thousands of jobs connected to the auto companies and stocks across the board, their downfall could have a large effect on our economy.
Con 2: Bankruptcy
One of the only other options for GM and the rest of the big three is to file bankruptcy under chapter 11. It is true that we have already assisted these companies financially this year and it helped them for few months. For this reason, some economists feel another bailout would just be like bailing out a sinking ship that is going to sink no matter what we do. Bankruptcy however, could be their only salvation, and many experts claim that it could be their best option. Michael Levine of the Wall Street Journal claims, “the cost of terminating dealers is only a fraction of what it would cost to rebuild GM to become a company sized and marketed appropriately for its market share. Contracts would have to be bought out. The company would have to shed many of its fixed obligations. Some obligations will be impossible to cut by voluntary agreement. GM will run out of cash and out of time.”
Pro 3: Prior Success
As history tends to repeat itself, I think it important to consider the Chrysler bailout of 1979. In the mid 70’s while our country was going through a gas crisis, Chrysler refused to stop making their biggest most gas guzzling luxury cars. This mistake led them to requesting a bailout in late ‘79. However, to the surprise of the watching country, Chrysler came out with the “K-car” that sold like hot cakes and pulled the company out of a financial crisis. Chrysler then paid off their debt to the government 7 years early, and the government made over $660 million in profit from the bailout when all was said and done. Many people claim that if given another bailout, the auto companies could pull themselves out from near bankruptcy, and the federal government could generate revenue as well.
Con 3: Private Jet-setting
Unfortunately, when the CEO’s of the big three traveled to Washington D.C. to request billions from taxpayers early this week, all three CEO’s took private jets with round trip travel costs totaling of over $40,000 per CEO. This ostentatious show of wealth was considered highly disrespectful to the taxpayers about to consider bailing them out and created tons of bad publicity for the potential bailout. If companies are going to get taxpayer’s money, then we need to know that they are being frugal with it.
April