"I think there will be a sigh of relief (in the markets). Essentially,
we will be given nitroglycerin to prevent a heart attack and get some
color back in our face," said Sung Won Sohn, professor of economics at
California State University.
luckyman ( Date: 29-Sep-2008 08:00) Posted:
U.S. policy makers say tentative rescue plan is set
U.S. policy makers, working through Saturday night into
Sunday, said they'd had outlined a plan to rescue the financial system but
needed to put it on paper before saying that they had a final deal, The Wall
Street Journal reported Sunday morning. Treasury Secretary Henry Paulson, House
Speaker Nancy Pelosi, and Senate Majority Leader Harry Reid stood with top
negotiators to announce the tentative accord on a $700 billion plan to have the
Treasury purchase bad assets, the Journal reported
One of the readers made the following comments:
Well, the bill for bailouts is already over a trillion
dollars. Not much if you say it quickly is it? My problem with the modified
Paulson Plan, quite apart from the undue haste with which it was negotiated, is
that it is not likely to have more than a short-term effect. Tomorrow, the DOW
will jump as the lemmings fall for the stunt, but within a week all the nasty
stuff will return to haunt us. My other reservation, other than the fact that I
don't like govermental interference in the market, is that there is no
guarantee that the bailout will actually work in the way that they hope. My
greatest fear is that it won't work in any sense and the "powers that
be" will turn instead to a policy of frugality: meaning extremely high
interest rates. If the latter actually comes to pass, the current climate of
forclosures is going to look like a picnic by comparison.
50 years ago, American debt was owned entirely by Americans. Today, that is not
the case and the reactions from the foreign holders of debt is simply not
predictable over the longer term, i.e. over 30-days! In this past week Paulson
and friends engineered a deal whereby banks from the G7 agreed to buy hundreds
of billions of dollars of American debt in an act of solidarity. So far so
good, but we have to ask what happens next time -- because assuredly there WILL
be a next time. The trillions of dollars' worth of worthless derivatives
"paper" is still zooming around in cyber space and there will be a
final reckoning because nature cannot tolerate a financial vacuum
U.S. policy makers say tentative rescue plan is set
U.S. policy makers, working through Saturday night into
Sunday, said they'd had outlined a plan to rescue the financial system but
needed to put it on paper before saying that they had a final deal, The Wall
Street Journal reported Sunday morning. Treasury Secretary Henry Paulson, House
Speaker Nancy Pelosi, and Senate Majority Leader Harry Reid stood with top
negotiators to announce the tentative accord on a $700 billion plan to have the
Treasury purchase bad assets, the Journal reported
One of the readers made the following comments:
Well, the bill for bailouts is already over a trillion
dollars. Not much if you say it quickly is it? My problem with the modified
Paulson Plan, quite apart from the undue haste with which it was negotiated, is
that it is not likely to have more than a short-term effect. Tomorrow, the DOW
will jump as the lemmings fall for the stunt, but within a week all the nasty
stuff will return to haunt us. My other reservation, other than the fact that I
don't like govermental interference in the market, is that there is no
guarantee that the bailout will actually work in the way that they hope. My
greatest fear is that it won't work in any sense and the "powers that
be" will turn instead to a policy of frugality: meaning extremely high
interest rates. If the latter actually comes to pass, the current climate of
forclosures is going to look like a picnic by comparison.
50 years ago, American debt was owned entirely by Americans. Today, that is not
the case and the reactions from the foreign holders of debt is simply not
predictable over the longer term, i.e. over 30-days! In this past week Paulson
and friends engineered a deal whereby banks from the G7 agreed to buy hundreds
of billions of dollars of American debt in an act of solidarity. So far so
good, but we have to ask what happens next time -- because assuredly there WILL
be a next time. The trillions of dollars' worth of worthless derivatives
"paper" is still zooming around in cyber space and there will be a
final reckoning because nature cannot tolerate a financial vacuum