The Bailout Bill Is.....
CRAP. (read: Congress Rapes American People).
The Senate in it's ultimate wisdom decided it would take the bail-out bill that the House of Representatives voted down on Monday, loaded it up with a mere $150 billion dollars of pork and passed it by a pretty substantial margin. Now that same pork-laden bill has sent back to the House of Representatives for a vote on Friday morning. I guess they figure pork cures all ills.
The new bill did address a couple of issues that needed addressing.
First, it raised the FDIC guarantee on deposits to $250,000. ($100,000 just isn't what it used to be.)
Second, it changed the mark-to-market accounting that had the banks in a strangle-hold.
Unfortunately, the bill fails to address the underlying issue that got us into this mess in the first place. The banks and other lending institutions gave loans to people who couldn't pay them back. People with rotten credit were given loans. People were qualified at the teaser rate of adjustable rate mortgages who would not be able to pay the mortgage once the rate adjusted to the real rate. People were allowed to buy houses with no money down and some were even allowed to finance the closing costs, which meant they were upside down on the property from the minute they closed.
If this is truly a crisis of the first magnitude, Congress should pass a stand-alone bill (no pork) that addresses the underlying problem before we start throwing around $700 billion dollars to bail out Wall Street. Anything else is nothing more than CRAP.
Posted by Rick | October 2, 2008 11:38 AM