Sorry Mr. President, but me and about oh, 200 million other folks think that bailing out the banks is a bad idea. I have no objection giving money to my neighbor to help him out, but a bank, in an industry that got all the rules turned in their favor and then stuck the public with 29% interest on consumer debt, well it just does not sit well with me.
So, here is my solution:
Give $100,000 to each and every homeowner with and AGI of $90,000 or less. This will first be applied to the mortgage balance, the banks will also be required to re-write the notes to a maximum of 6% on the balance (if any balance remains) if there is any excess, good for homeowner with living close to their means. By giving the money to the PEOPLE it does several things.
1) Elimination of homeowner debt is the first step into generating savings which is what the Japanese have found out is a key element in stabilizing the monetary system.
2) By putting the money towards Homeowners, you secure the people who pay the bill in the first place. This will drive up consumer confidence and avert stag-flation or worse yet, hyper-inflation.
3) With the non-taxable 1 time gift, banks will recover a significant portion of their liquidity. Banks which properly screened and managed loaned money will survive by the early pay back where the ones that baited people into buying more than they really could afford will suffer. Here is were we have a past performance based system where the current proposal uses a future performance based system.
4) Creating a strong central bank authority is tantamount to creating another IRS agency, if things do not go as they predict they will ask for the laws to be changed. As this agency will likely be run by the same banking educated persons that got us into this mess, I see closed military bases being re-opened as debtors prisons and a entire swath of questionable activity as is currently the case with the clean air agency under the patriot act. Case in point is the Department of Education, no accountability, no compromise and no bankruptcy.
5) By securing owner/ occupant homes, you are securing the not only the dream of America, but at a larger scale, securing the faith in our system which is what our currency is based upon. Since Nixon took us off any real secure interest (gold, silver, diamonds etc) our currency has been based on faith and the requirement that oil only be purchased with US Dollars. When faith wains, the dollar suffers and has never recovered.
As for the other countries that sought to gain by investing in un-secured banks, they should not be protected. Their investments should have been in Treasury Securities; Bonds, T-Bills and the like. Their greed for profit while being a sovereign nation does not protect them from their ill guided investments. Those that invested wisely will recover their investment as they are in with the banks that will recover from protecting the United States Homeowner.
When George, Thomas, Ben and the boys sat down some 200 years ago and created the United States; the qualifying theme throughout all their letters and discussions was that government is of and for the people and the role of government is to serve and protect the people. When did Our Lord ever breath life into the nostrils of a bank?
Does giving money to the respected persons that got us in this mess in the first place make any sense? From this perspective giving more to the abusers is like give a demerol prescription to a meth addict. How can you be convinced that once the addict is regulated that their cravings will end.
here's our DIGG location
http://digg.com/business_finance/Bush_s_Bank_Bailout
Posted by: mitch | September 27, 2008 at 10:49 PM