

The House has passed the economic bailout bill 263 to 171 - eposts
http://money.cnn.com/2008/10/03/news/economy/house_friday_bailout/index.htm?postversion=2008100309

======
mynameishere
Maxine Waters:

 _When we buy up this toxic paper, we're in charge. We can do the kind of loan
modifications we've been urging [the industry coalition]..._

Here's a clip of Maxine:

<http://www.youtube.com/watch?v=KN6s1KVFBNg>

...she is making a threat to nationalize the oil industry, but flubs the word.
The reporters basically laugh at her, and compare her to Hugo Chavez. Guess
what? The imbecile wasn't that far off...

We have no real conception of how screwed we are, but we know one thing: The
credit market is now fully subject to political constraints. To what degree is
hard to say. But congress has already been forcing banks to give loans to
unqualified people (a big part of the original problem) and so the same
practice will likely continue. Except, banks know full well that every bad
loan can be sold to the taxpayer at full price.

An unbelievable coup.

~~~
alecco
You seem to imply two false points. Chavez was elected democratically, twice.
And Venezuela's oil was not nationalized.

I don't like the paternalistic and interventionist style he has but he isn't
Fidel Castro. In many ways, he is quite a capitalist.

~~~
mynameishere
"You"

Rather, the reporters did. And Waters was also elected democratically. And
that's not the point; the point is the media's reaction to nationalization
then and now.

~~~
alecco
"[...] and compare her to Hugo Chavez. Guess what? The imbecile wasn't that
far off..."

To me that line makes him own the journalists's remarks about Chavez.

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biohacker42
My $0.02

The Good:

A non trivial part of the market freeze was due to the uncertainty about the
bailout. Will it pass and if so at exactly what price will the Feds buy the
toxic junk. Rather then sell, people were waiting. Perhaps now things can
start moving again.

So this may be better then doing nothing.

The Bad:

The may be worse then doing nothing. We may spend a whole lot of money and not
make a profit on it. Steal (by inflation) from all the people who save, to
give to the bankers, and the bankers could still fail.

Many experts argue a better alternative would have been to pick a few winners
re-capitalize them and then let everyone else fail. The core issue here is
solvency not liquidity, the bailout addresses liquidity, which many consider
just a symptom, not the disease.

More may have to be done, like re-capitalization, yet more may not be done
because while this time there are no pitch forks in DC, there may well be next
time. And thus, this could be worse the doing nothing.

'Ain't economics fun.

~~~
einarvollset
Right on the money.

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jcromartie
If I may paraphrase a Redditor...

    
    
        "So is this good or bad for the economy?
        
        Bubble: bigger
        Collapse: inevitable
        Distance to fall: farther
        Dollar: worthless"

~~~
peakok
This plan is a disaster that will be remembered as one of the worst error in
History ever. The US shot its last bullet, and it aimed at its feets. Buckle
up, folks, cause the future is even more incertain now for the world.

~~~
astine
I dunno, It will be hard to top Smoot-Hawley.

~~~
nsimpson
Ripped directly from Wikipedia: The Smoot-Hawley Tariff Act (sometimes known
as the Hawley-Smoot Tariff Act)[1] was an act signed into law on June 17,
1930, that raised U.S. tariffs on over 20,000 imported goods to record levels.
In the United States 1,028 economists signed a petition against this
legislation, and after it was passed, many countries retaliated with their own
increased tariffs on U.S. goods, and American exports and imports plunged by
more than half. In the opinion of most economists, the Smoot-Hawley act was
partially responsible for the severity of the Great Depression.[2][3]

~~~
zandorg
Oh dear, I can't resist.

Bueller? Anyone, anyone?

~~~
helveticaman
?

~~~
zandorg
The Tariff Act is in the film Ferris Bueller's Day Off, with the teacher's
"This act... anyone, anyone? - Raised...", except there's a line where he's
taking class attendance register and goes "Bueller - Bueller". So I mixed both
references. It's definitely an in-joke for viewers of the film. :-|

~~~
helveticaman
Oh yeah!

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kqr2
What's the main difference between this bill and the one that was rejected
last week? Is it just the pork offerings including a tax credit for racetrack
owners and makers of wooden toy arrows?

~~~
jws
The arrow thing is popular with pork pokers, but what it is doing is
correcting an accidentally applied tax.

In 2004 there was a small $0.39 excise tax levied on weapons. Unfortunately,
$0.30 target arrows are considered weapons under the law so they got a 130%
tax accidentally levied on them.

Any politician or journalist that grouses about arrow makers getting special
handouts is either uninformed or attempting to deceive you. I recommend you
ignore them as a source of future information.

~~~
socmoth
i wish there were wikipedia style discuss pages for legislation. especially
for things like this.

~~~
babyshake
[http://publicmarkup.org/bill/emergency-economic-
stabilizatio...](http://publicmarkup.org/bill/emergency-economic-
stabilization-act-2008/)

thank you, Sunlight Foundation.

~~~
davidw
Good link, but the commentary there is just as bad as on this site.

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marvin
I thought this bill was the worst idea ever, until I heard Warren Buffett
speak up for it two days ago. Buffett has both integrity and economic skills,
and he probably understands this proposal better than any of us.

For instance, [http://ph.news.yahoo.com/rtrs/20080924/tbs-buffett-
bailout-7...](http://ph.news.yahoo.com/rtrs/20080924/tbs-buffett-
bailout-7318940.html)

The US government has a pretty poor track record for "emergency proposals" and
other decisions these last 8 years, so I understand the skepticism. I'd vote
against it myself. But there's more to the story than what you hear in most
inflamed internet postings. Buffett himself says that we eventually need to
roll some heads, but that it shouldn't be our first priority.

    
    
      They shouldn't buy them at what they're carrying, what the carrying value is, necessarily.  
      They should buy them at the kind of prices that are available in the market.  
      People who are buying these instruments in the market are expecting to make 
      15 to 20 percent on those instruments.  If the government makes anything over its 
      cost of borrowing, this deal will come out with a profit.  And I would bet it will come out with 
      a profit, actually...

~~~
einarvollset
Fuck Warren Buffet. Who died and elected him grand master of the universe
anyways?

Note that I'm not asking whether he knows how to make money - clearly he does:
witness putting $5.000.000.000 into Goldman Sachs and then lobbying like hell
for the bailout of ....... ..... (guess who?)

~~~
einarvollset
Is it the swearing that gets the downmods, or the contrarian view? Either way:
Any of the downmodders have further thoughts now that the Dow is taking a
beating despite the bailout?

------
michaelneale
This is a real low point for HN (comment wise), the subject matter is
interesting but I would have expected some interesting comments.

~~~
davidw
Well, like you wouldn't want to read Paul Krugman's or Tyler Cowen's opinions
on programming languages, most people here don't have much that's truly
insightful to say about economics and finance, with the exception, perhaps, of
economics as related to software. I guess there are a few people who work or
have worked as quants and know more than a thing or two about finance, but how
much insight does that give you into the system as a whole, which is what
broke?

This remains the best thing I've ready so far, in terms of something brief and
at the same time thoughtful:

[http://www.marginalrevolution.com/marginalrevolution/2008/10...](http://www.marginalrevolution.com/marginalrevolution/2008/10/my-
views-on-the.html)

~~~
michaelneale
Thats my thoughts exactly. I feel like I know less everyone else, as everyone
seems to have an opinion or something to say, yet as I don't understand the
system as a whole, I would rather just shut the hell up and contribute in some
positive way (thats all we can really do at the end of the day).

So well said !

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eposts
Here is the roll call: <http://clerk.house.gov/evs/2008/roll681.xml>

------
gills
Pitckfork: $10

Torch: $15

Freedom: Priceless

P.S. This is a joke...

~~~
qqq
Torches are one copper piece which is much less than a pitchfork.

~~~
tectonic
'use skill create torch' when in the outer-world, dumbass. Save your money in
ING.

~~~
qqq
Don't flame me, I have a torch, with umm a big flame. Hah! _waves torch
menacingly_

------
rgr
And I thought the democrats were the good guys... Now I really don't know whom
to vote for. Wall St will get rich, but the political system has gone
bankrupt.

~~~
jm4
This is totally off topic so I'll probably get modded down. Please don't be
too harsh...

Thinking the Democrats were the good guys is your first mistake. The sooner we
all realize neither side is good, the better. They are both equally bad in
only slightly different ways. The Democrats are mostly impotent. They do
nothing. They talk a great game and have some good ideas, but they almost
invariably fail to execute. The Republicans know how to get things done. The
only problem is it's often in the interests of a very small, elite minority.

Thinking one side is the 'good guys' is a big part of the problem we have
right now. Fifty one percent of the population thinks the Republicans are the
'good guys' and continue to vote party lines, despite 8 years of bad policies
and low approval ratings, instead of voting based on qualifications and track
records.

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patrickg-zill
We will know in about what, 4 weeks, whether this actually did what Paulson
claimed it would do. If not, then all we did was line Goldman Sach's and
others pockets...

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lallysingh
One of the meanest things a friend has ever said to me is "people get the
government they deserve."

Part of me still hates him for that.

~~~
Chocobean
a _democratic_ people get the government they deserve.

those living under a monarchy or dictatorship get to say "Well I didn't vote
for you~"

~~~
kingkongrevenge
The nation's control over its form of government goes beyond voting. All
people have the government they deserve.

------
jobeirne
I signed the wrong social contract.

(but it's not like anywhere else is preferable)

~~~
DanielBMarkham
Did you keep your receipt?

Maybe you could take it back and get another one.

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nihilocrat
They misspelled Howard Coble's name. They said "Howard Cobble".

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siculars
we avoid fire and brimstone! but will pay for it forever! i want to see this
"investment" as a dividend in my tax return.

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speek
I think we're going to be the largest and richest third world country in the
world because of this. Lets hope I'm wrong.

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ajmoir
Feckless bastards

~~~
josefresco
We all are feckless actually, as they (the gov) represent us.

~~~
Hexstream
or _mis_ represent us?

------
MikeCapone
Damn.

