Bank Bailouts, what does the term mean to you?

[Just_A_Guy]

Those who were bailed out were not the banks and other financial institutions. Those who were bailed out were the auto companies. A couple of them took their loans and then filed bankruptcy.

No fan of the auto bailouts, but just a bit of clarification: it's not like the auto companies double-crossed Uncle Sam. The bankruptcies were "prepackaged" bankruptcies, and the loans/bailouts were done on the understanding that the companies would file for bankruptcy. In fact, the government used the leverage given by the promise of additional loans, to force the bondholders into a detrimental position and get the unionized workers a better deal than they otherwise would have gotten under conventional bankruptcy law.

[BenRaines]

Just a guy. Agreed. So a failing, outdated industry is truly bailed out by the government to protect union jobs. Now that is something to be angry about.

Ben Raines

[annewandering]

As I recall an important part of the bailouts was that the loans to small business and people would start being made again. This did not happen. Instead we saw CEOs and stockholders getting record profits. And you ask why people are mad? We were conned.

Now you want to mention violence of the Occupy Wall street people? and yes it is a part of the the bailout. What do you think made people so mad? The bailout was a last straw.

It was supposed to create jobs. Ha. The 1% do not create jobs. They savage jobs. Check out how Mitt Romney made his money. He took over companies and gutted them and walked away with the cash. He is not an isolated case. By the way back when the SL Olympics was in a quagmire and Romney not only saved it but made it very successful, I told my family he would be president some day. He does know how to fix things. I was very disappointed to learn he was a corporate raider, which to me is legal but lacking in morals.

How many protesters have attacked non protesters? Let me see. 0? So who is being violent? Who snuck up on women already correlled in a containment fence and pepper sprayed them? Protesters? No it was a white shirt policeman who snuck away as fast as he could. Even the blue shirted police were looking at each other in dismay clearly wondering what had happened.

OWS protesters dont need people to 'teach' them what do do now. As the link to the Tea Party cocreator pointed out that was a big mistake the tea party made. Letting someone else set the agenda. We do not need anyone to tell us why we are mad. We know why.

It's time to 'bailout' the American public. The 1% dont need more bailouts.

[rameumptom]

The banks made incredibly risky loans and complicated hedge fund packages, etc. They were encouraged by Congress to make risky loans, with the implied promise of being bailed out if necessary.

So, Wall Street jumped all in, making riskier and riskier loans, and making packages that were so complicated and confusing that when they collapsed we were told they could not fire anyone, because no one else would understand its complexity.

Banks encouraged poor people to buy more house than they could afford, often giving them 125% of the home value! Balloon payments and ARMs did not help. The banks were focused on short term huge gains, and did not worry about the long term disaster they were involved in creating with Barney Frank and Chris Dodd (among others in Congress).

Historically, banks would capitalize or leverage to about 20% of the money in their vaults. IOW, if they had $1 million in the vault, they would loan up to $4-5 million dollars. In the last few years, they were loaning $40-50 million for that $1 million in the vault.

Previously, if 20% of their loans defaulted, they would lose $200,000 and could pay it off. With the huge leveraging they were doing, to lose 20% of their loans meant they would lose $8 million, or $7 million more than they had in the bank. This reckless attitude came about because they believed they would be bailed out.

Since the bail out, most of the banks have not loaned much to anyone, except the federal government. We end up having a circular event, which excludes most small businesses from getting loans, or at least having to compete with the feds for a loan.

Second, the bailouts only enriched the wealthy, rather than helping the nation. Foreclosures are at an all time high, while the banks who caused a lot of the problem are not suffering. It would have been better to use the $878 billion to pay off portions of foreclosed mortgages, saving people's homes, and recapitalizing all banks, not just the biggest ones who are "too big to fail."

What we have here is no longer capitalism, but corporatism. And it has to stop before it turns us into a third world nation, while the big corporations still grow richer by moving their money to other nations.