Gloria Ferris

one woman’s view from a place by the zoo in the city

Archive for the ‘Wall Street’ tag

The Nation Waits with Bated Breath–Is It a Loan or Is it a Bailout?

without comments

 

Warren Buffett knows if you are going to take on great risk, be sure to negotiate a hard bargain and at least have the option to make millions.  I just received my latest edition of The Economist where I learned this. 

I haven’t seen anything on line about the $700 Billion Bailout of the banking industry.  Personally, I like the idea of loaning them the money.  You see, when they get behind on their loans because they haven’t the money to pay back the American taxpayer, we can have our servicing agent, the government, tell them that their “client” has informed them that they can no longer work with them and that they are in default.  We, the taxpayers, will then own the banks.  In other words, we can foreclose on them. Turnabout is fair play.

Why in the world would we the American Taxpayer give the money to the banks without getting something in return?  Shouldn’t we let the free market decide which banks would survive and which would become part of the collateral owned by the United States?  After all, I believe that is what U.S. Treasurer Hank Paulson recommended not so long ago when told that the housing bubble had burst and that the walls were crumbling down.

Of course, no one knew just how far the rolling stones would fall and now that retirement and pension funds, local and state governments will be affected by this debacle, something should be done.  But I ask you, why should we give them this money with no strings attached so that they can again “play the game” with no repercussions for the reckless way they played “the game” this time?

Could that be the problem with this whole scenario?  It wasn’t a game, it was people’s lives, it was people’s savings, it was America’s way of life.  It was only a game to those who saw only the numbers and never the faces behind those numbers.

I see no reason that we the American Taxpayer should bail out the financial industry without receiving something in return.  After all, according to the investment gurus, our world revolves on ROI (Return on Investment).  Maybe not so much.

Written by Gloria Ferris

September 29th, 2008 at 3:50 pm