If the problem is liquidity - why does my ATM card still work? I keep

[BR_Parkway]

seeing all these posts that the banks aren't lending to one another in settlements at night that would reimburse these banks when the money transfers. But I can still use my debit card at the grocery store, and as far as I know, they all don't bank with the same bank I do.

I own a couple of small businesses - and every credit card I've swiped for a customer in the past few weeks - has gone through and the money transferred to my bank account just like it always has. So either everyone using a CC is banking with the same bank as me, or there really are banks that are working together still, in spite of the news reports to the contrary.

Every single 'news' report I've seen to reinforce this 'liquidity crisis' has been some banker talking about how yes, they are looking harder at a potential borrower's credit and ability to repay the loan. WTF, isn't that the kind of more responsible lending that would have kept us to getting into this mess in the first place? So why is it being spun as a bad thing?

If the non-performing assets are considered worthless because a portion of the mortgages involved are sour, can't they simply change the rules to allow them to be counted differently? I know, that's terribly naive, but is it any less risky to say a bank doesn't have to have quite the capital requirements on hand to remain 'solvent' than it would be to hand out hundreds of billions in Paulson's bailout? It would give the banks some room to clean up the toxic stuff and if they still failed, we'd still be stuck with the bill - but if they succeed, then it didn't cost us anything.

And how come, if AIG was taken off the DOW, is that number still being reported with a replacement company with very little change in the overall number beyond the daily ups and downs? Shouldn't the number have been very different right after they swapped?

[Virginia Dare]

1. They're telling us that could change by the end of the week..

we'll see. I hate that they're playing this game of chicken with our lives.

[BR_Parkway]

6. But according to all the experts, the problem is already here

None of it adds up, and I hate being pushed to make a decision about for or against anything when I don't know what all the facts are. And right now, none of it adds up to what's being said about it.

At least with Saddam, we knew he had WMD, we had the receipts from where we had sold them to him.

Now, rampant speculation as to what is really happening - but none of what we're being told adds up to the reality that we're seeing. And yet, those in Congress certainly seem to believe something they've been told in order to get them to vote for it. And the Repubs, who have seen/been told the same thing - walk out after voting against it and blame Pelosi for hurting their feelings.

So it either 1) the worst crisis we've ever faced or 2) no where near the crisis they're trying to tell us it is.

[Virginia Dare]

12. I wish I had the answers, but I don't...

I like you only know what "they're" telling us. Lots of people I'd like to trust are telling me this. I have no where else to turn. FWIW, several people have posted here on this board that their employers have told them if the bail out doesn't go through they will begin laying people off immediately. Like I said, take that FWIW.

[DeschutesRiver]

9. Yep - what you said.

Time is short, and we will know quickly just how dire the credit situation really was, and what the effects are going to be. I can't even keep up with all the directions this is coming from, nor can I keep with with all the levels being played on this chicken game.

There are payrolls tomorrow; ss disability checks and retirement checks that need funding and mailing end of the month. OTOH, I am one of those who only thought a bailout would be a tiny bandage, maybe for a few weeks or months if lucky. So crash now or crash later...I was beginning to think that if the bailout passed, there would be more time for people to get real and try to position themselves for the crash landing to come.

[Critters2]

2. I keep seeing commercials for banks and credit cards, too.

If they're not going to be lending money anymore, why are they trying to get people to apply.

My BS meter just will not turn off.

[anigbrowl]

5. To attract customers who do have good credit

Ceasing to advertise completely is tantamount to saying 'we have no more money'. No bank is going to do that, they're going to keep soliciting customers and just rejecting more of the risky ones.

[onecent]

3. Another one of Bush's LIES.....I think people are scared about

the market, I know I am but I'm not bailing.

If I lose...then I lose...but I think Bush is a complete MORON..and I think anything that comes out of his mouth is LIES.

I'm enjoying McDrain trying to wiggle out of his gaffe...ha ha

[Lex]

4. I heard a guy on NPR that said soon your debit card won't work

maybe he was fear-mongering, I don't know.

[BR_Parkway]

13. But why? How much would one bank owe to another over the course

of a day or even a weekend? A few million? compared to that bank owing a few million back to the first bank?

Now the talking head is saying companies won't be able to borrow for their payroll - I personally pay my payroll from operations, not loans but I can see that some companies cash flow would require them to borrow to pay. But is that really a banking crisis problem - or more of a problem reflecting our national addiction to debt and a failure of a company to plan their reserves better?

[SammyWinstonJack]

7. They want us to run around with our hair on fire, that way we won't think about it and they get

what they need/want. It's been this way for the past 8 yrs. I am quite frankly sick of their fear mongering. Enough!

[Virginia Dare]

15. I'm not running around with my hair on fire, but I am pretty worried..

I hope calling them on their bluff was the right thing to do, we'll know very soon.

[SammyWinstonJack]

18. I think we'll be fine. And I am not given to optimism, much.

I just don't trust the ones who caused this, the fat cats and I trust the bu$h maladministration even less.

[Virginia Dare]

19. No, but it's kind of like the little boy who cried wolf..

we just have to hope they weren't right this time.

[anigbrowl]

8. It works now, but that could change

It will still work tomorrow. It will still work next week. But if something isn't agreed soon, it's possible that it won't work next month or (more likely) your daily spending limit will be reduced. Instead of being able to spend, say, $700/day it'll be reduced to $400/day.

[EFerrari]

10. My family business is seeing credit tightening up.

I think there is a problem but it's not as bad as little Bush wants us to believe.

[still_one]

11. Just wait, if nothing is done, you will feel the effects. Hopefully, you won't need to borrow

and won't have to worry about your job

[BR_Parkway]

16. So you're saying my bank, who makes their money off loaning out money

at a higher rate than they pay me for putting it into a savings or CD - is going to simply stop lending to anyone and basically quit generating income? That makes no sense whatsoever.

[shadowknows69]

20. That's what I've been saying

[still_one]

21. What I am saying if there is truely a liquidity crisis, they won't have the money to lend

retailers that stock their inventory based on credit will also be jepordized

Washington Mutual went under because they didn't have the funds
The same goes with Wacohvia, LEH, MER, AIG, FANNIE and FREDDIE, etc

There is only so much the fed can do, that is why they went to Congress

It remains to be seen what will happen now

As far as you premise loaning out money at a higher rate, where do you think the banks get their money?

[doc03]

14. Why do I still get credit card offers in the mail every day? n/t

[Lex]

17. Marketing. Doesn't mean they'll honor them

when push comes to shove.

[still_one]

22. You haven't felt the effects yet if nothing happens /nt