I'm SOOOOOOOOOOOOOO Confused

[DemoRabbit]

Boycott the Bailout.
Support the Bailout.
Support the Bailout but only with serious revisions.
There's a credit crisis.
There's no credit crisis.
The fundamentals of the economy are sound.
PANIC! Everything's about to come tumbling down.


This is how it plays on the news, in life, and around here. No one knows what they are talking about or everyone knows what they are talking about. How the hell are any of us supposed to know who to listen to??? Someone with "credentials" comes along and posts about how they KNOW for sure that there's no crisis. Someone else comes along with equal "credentials" and says that's WRONG... we are in for a big fall. The experts on TV can't agree. Then last night I'm watching cspan and a bunch of economists hold a discussion explaining how something needs to be done but the bailout isn't it.

My head hurts.

I'm math-challenged as it is. Reading about economics the last few days leaves me more confused than ever. I know that we rely on credit more than most people think and if there IS a credit crisis we're all in serious trouble if something isn't done... but honestly, I don't know who to believe anymore.

What I do know is that at my job things are BAD and without any crisis what-so-ever we'll be lucky to be in business in six months. According to CNBC, if you believe them, dealerships are really struggling, reporting sales down by up to 20% and empty showrooms because people are not buying cars and those who want to can't get credit. Around my community everyone is complaining about how bad things are, from the local diner and hair salon, to my brother-in-law who works for Bank of America.

I'm exhausted thinking about it.

[Fresh_Start]

1. its bad

one of the top three reasons for small business failure is insufficient capital or cash flow.
Most small businesses are undercapitalized and are relying on short term debt to stay in business.
Because they have few other alternatives, they are going to be the first to starve to death in the credit crisis.

[DemoRabbit]

3. That is something I have learned and totally get...

but you have to believe there's a credit crisis in the first place. Some people around here say there isn't one.

You have some tylenol? LOL

[Fresh_Start]

5. there is a credit crisis

the others are deniers or clueless

[Virginia Dare]

6. Yep...n/t

[girl gone mad]

7. There is a credit crisis..

but it's being hyped significantly and blamed on the failure to pass legislation.

I support a bailout but only with serious revisions.

There is no guarantee that the banks will start loaning to each other again once we give them the money, and there are no guarantees that they will to continue to loan money to us at a time when we are experiencing a serious downturn.

[Fresh_Start]

11. due to the decrease in asset value

banks are approaching being undercapitalized.

the infusion improves their balance sheets gives them room to lend.
At this point, their asset values are still deteriorating due to the continuing home price deflation and increase in at risk assets.

The reason banks are failing is because they don't have enough assets to support their loans.
The more assets fail, the more capital that is required to support the existing loan portfolio due to the deteriorating in asset quality.

They need infusion of capital to support existing loans forget about supporting new loans.

[Greyhound]

10. There is, but the solution being completely ignored is that the Fed

already has the authority to guarantee the inter-bank loans and direct it's member banks to release funds for this purpose.

They have an agenda and are purposely not acting to scare us into doing what they know no sane person would willingly do.

[Speck Tater]

2. Pour yourself a drink and sit this one out. NT

[Virginia Dare]

4. No need to be confused...

1) Things are bad and will get worse, no matter what the politicians do.

2) Don't panic, but if you're on the bottom 80% financially, unless you've positioned yourself to ride out a long recession you're probably going to get screwed, and even if you have, there's still a good chance you'll get screwed, so start thinking in those terms for the future. Prices will go up, interest rates will go up, and jobs will be lost and or hard to come by for a while.

4) Vote Democratic in November.

[Greyhound]

8. That's exactly the reaction they want. Same strategy they apply to everything they want.

Is there a problem? Absolutely, yes.

What can/should be done? End of reasoned discussion and fear mongering starts. Suffice to say that it is very complicated and the result of very shady, in fact illegal until 2000 (Thanks to Gramm Bliley Leach Clinton), deals and a thoughtful analysis will expose the deals and who did them and what needs to be saved and, most importantly, what needs to be cast aside, that is what they don't want to happen.

Most of what they want to save is their bad deals that benefit no one but them, the managers and investors in these abominations.

[GeorgeGist]

9. Two words ...

Shock Doctrine.

BTW it's a form of torture.