The banks should have never been bailed out. This was a special interests getting taxpayer money on a massive scale. If the government wanted to lend money to struggling homeowners, why in the world did they give the money to the banks??! It should not have taken a genius or fortune teller to know this was a completely stupid idea. I suspect there was plenty of lobbying from the financial sector.
Unfortunately to this day I still don't see an alternative to the bailouts that doesn't result in a depression. As bad as the bailouts were they saved a lot of people a lot of stress. But we should be taking action to make sure this doesn't happen again. We should be splitting up the banks. We should be making sure banks never get this big again. And we should be making sure the people handing private mortgages are not the same people handling investment accounts. Too big to fail isn't an option. if you're that big you should be broken up.
Yep it was the only road , bail out the banks with tax payers money so they lent them back to tax payers ON INTEREST. Makes sense....
You don't think just handing out free money to everyone wouldn't have been a better idea? All that money had to come from somewhere. Which do you think hurts the economy more, taxation or wealthy account holders losing their savings?
It's hard to say. A lot of people would have lost their bank accounts. But that's what FDIC insurance is for...
Maybe some of these people should have been allowed to lose their bank accounts. You can't expect to earn an interest rate without taking some risk. These people should have done due diligence to see whether their bank's investments were sound. Bailouts reward and encourage banks to take more risk in an attempt to get higher returns. So what about the little guys? Well, what about those who do not have money to put into a bank account? If the government was really trying to help the little guy, it would have just allowed the FDIC to do what it was designed to do. The fact that the government stepped in with bailouts shows that they wanted to guarantee the investments of the wealthy.
Maybe this is a silly idea but, how about this: The government (therefore "we, the people") gave away (or lent?) 50 billion dollars to the banks to bailed them out, but, how about the government (hence, us, the people) giving the money to the bank account holders?. For example, they know that Goldman and AIG and...are going to fall, so, they calculate the customers in those banks with all the money they have. I know it sounds very simple, but, is it such a silly, stupid, impossible idea to carry it out?. So: We, the people, have given away (not lend I must suppose!) a lot of money to the banks, and we, the people, won´t receive any money back until they feel even safer....sounds totally weird, strange, odd, unfair to me, no matter those who claim "too big to fail". Could someone explain why they were too big to fail?. I know that it may be more painful for the people if we would have let them fall, but I would like to know why and besides, I think that IT WASN´T THE ONLY SOLUTION. HOW CAN´T THE BANKS LEND MONEY NOW THAT WE HAVE BAILED THEM OUT?!! HAS ALL BEEN A GIFT FROM THE PEOPLE TO THE BANKS? FOR FREE?
You're talking about moral repercussions. Not good economic policy. It's never good economic policy to allow millions of people to lose their homes.
hey do not forget that we are living the dictatorship of the banks, they could easily give the bail out money to people with accounts.
Well, I am hearing people claim that they (the banks) are panicking , in panic, so, they don´t feel sound, or safe to lend money, but I still wonder: what did we give away the money for free, and no conditionality? Did we give the money or did we lend the money to them? Could elaborate on "...they could easily give the bailout money to people with accounts" ? Why didn´t we put conditionality to the banks?
Well, I am hearing people claim that they (the banks) are panicking , in panic, so, they don´t feel sound, or safe to lend money, but I still wonder: what did we give away the money for free, and no conditionality? Did we give the money or did we lend the money to them? Could elaborate on "...they could easily give the bailout money to people with accounts" ? Why didn´t we put conditionality to the banks?
banks are lending..just you need to qualify..to get a mortgage you need a credit score of 760 or higher to even have a chance at it..only5 per cent of the population has that...in the 70s they raised interest rates so only the top 5% could afford it now it is being done by credit scores..but the same thing...businesses are able to get loans but the consumers are spending less so we dont need cash to expand at this time
Just keep in mind that my understanding of economics is very poor If you have a 1€ account the state should bail out you by giving you this 1€ and let the bank fail & erase all the debts third parties have to the bank. It is the reverse thing from draining people of their money and throwing them into the black hole of banking , people with money generate demand and get the economy going while banks only generate debts. I am too wondering why the banks are panicking , they are taking loans in our name and lent that money to us with interest . There is no conditionality on anything because neolibarals have taken over our governments .
The bailout may have been necessary but the question was implementation. Why aren't banks lending money? Like a previous poster said, they are, but government also put higher requirements on capitalization and banks have to have much more capital than before to insure solvency. They lend but not like before which is a good and bad thing. Good to keep them solvent, bad because government wants you to borrow more to help stimulate the economy.
That is great, now that people have become either homeless or unemployed, they require more, fair enough!!
