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Monday, September 29, 2008

More thoughts on the bailout.

To be fair, I have to say that I haven't followed this bailout that closely. I have been paying attention on the news and looking at a couple of articles online. After today we found out that the bailout was actually declined, which to me seems like a good idea. Like we discussed it in class, these bad loans happened because of the government and the policies that have put into place to help people. From general information, it seems that companies have just gotten lazy, and have expected the government to just back them up. Sadly, companies that are now failing are large and handle a lot of business, which affects a lot of people leading to people losing investments and even their future. But for government to continue raising taxes, continue their borrowing with out regulation will not help. It seems like government wants to take the easy way out by issuing this big bailout and it's true that something needs to be done but with so many smart people running our government it seems like no one can come up with more than one solution. As for the economy in general, it cyclical. Yes this seems like a really bad situation but can it be possible to reach the depths that it did in the Great Depression? I really do think that it will has more to do with the expectations of the public. There will be pay cuts, less available jobs, people wont buy as much. But then again, you are still going to get up and go to work, still going to buy food for your family and you're still going to spend money on gas. I don't believe it's the end of the world, Tuesday will come and I'll still go to class even though the market went down like 700 points. Is there really a need to come up with a huge amount of money to save the economy right now? Or can there be time for more thinking and more options, maybe just breaking up these companies so the risk is spread out, and maybe other companies can buy them out. And I think that the public also realizes that and I'm glad, be it an election year or not, that some of our representatives are listening.

http://www.fdic.gov/news/news/press/2008/pr08088.html
http://www.cnn.com/2008/POLITICS/09/29/miron.bailout/index.html

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