85000 M $ to AIG. Small subsidies?

Is a strange sort of mixture of socialism and capitalism: Profits are private and losses are socialized!!!!

Very good observation, my opinion is that losses can mean votes so it can be political, it also can have economical effects, that would be way beyond my understanding.

I have said in earlier posts, that there was a professor in the 70's that stated that this country USA, we be more socialist then the USSR (Russia) at the time, And Russia would be more capitalistic that the USA.

Things don't just happen like AIG, Enron or Lehman. There are trails such as imaginative accounting and such the become relevant after the fact.

well said

Subsidies were mainly created to:

• Help new business to get up to speed
• Keep jobs in a specific sector
• Prevent catastrophic chain reactions

Governments will generally support anything that makes the country more viable. One company going under does not necessarily mean doom and gloom since another company may buy up the residue and hire the workers.

When there is no possible resolution and thousands of workers will be out of a job, and the downfall of one company will cause hundreds of other companies to fail; a responsible government will try to help out.

A risk assessment is done, and options are weighed. If the government has to step in, investigations will happen, changes to standards or procedures will certainly follow.

If the government has to step in, investigations will happen, changes to standards or procedures will certainly follow.

Ah Yes, but I'm afraid the guilty still walk away with millions. If the companies are allowed to fail, then the good old boys networks that result in bad management will be destroyed doing everyone a favor.

Welfare induces more Welfare. The only way to break the loop is to let the entity collapse.

The govs have not solved the problems, they simply spread the pain from one company to millions of tax payers.

Fellow Americans, you just gave $85000M/300M people = $280 each to AIG. But since the taxes are paid by about 10M households it is $8500 each working family.

Sorry, this is what living is a socialist system is all about. You must pay for the useless.

I agree about the bad business practices of AIG and also believe they don't deserve to be bailed out. I also wonder if the investors and public dealing with them
deserves bailing out.

Subsidies are always granted for a goof reason (it was intended as good but I will leave it as it is)

Unfortunately subsidies get abused or in any case results i n the wrong outcome.

the sad thing is that there were buyers trying to buy AIG when the government nationalized it.

We are being told now that without the bailout all of our financial institutions would collapse or meltdown in a chain reaction. Is this just more fear mongering, like looking for WMD's that don't exist?

Yes

Is this just more fear mongering, like looking for WMD's that don't exist?

yes. next why: because they do not want to leave the next administration with any wiggle room. they want them so indebt that improving social conditions will be impossible.

i will make a second posting here that is off topic explaining why most republican presidents since 1968 should have died in prison.

Hanky Panky Paulson's basooka

Companies are spend to much money for too little. They are literally spending everything on some stuffed shirts in hopes the investors will make a quick buck under their name. It's a huge problem that must be corrected. Companies are forgetting what product, and people mean.

Want to spend some time educating yourself?

sign up for hulu.com TV service.. takes a minute

Find the Mojo network and watch 2 series..

Bobby G Adventure Capitalist - I just can't say enough good things about this guy.

And.. Startup Junkies - If this happens to you.. you do have problems. Your company has problems.. This guy needs to come down from there.

...it's shameful how we are supposed to look up to these people and trust them with our money and time. give me a break.

...there are some other little series on there.. very informative I'm sure.

____ In terms of the bailout. It saved a lot of good people. Retirement accounts etc.. It should be a lesson to be avoided, and not to be made again.

Investors Business Daily---either today or yesterday----names and contributions made by FannieMae, and Freddiemac, to both Democratic, and Republican , politicians---(sorry---the Dems lose big on this one)---as regards to the current bailout mentioned, I would steer everyone interested, to research the money trail---I, for one, don't have the knowledge to do so, but there are those that do, and I would subscribe that we should pass any information on, in this regard, to our fellow members here----maybe a symbolic lynching would suffice....just a cynical viewpoint---c-mac

What do my engineering colleagues think about this?

It's Rope-A-Dope

Of course I am not expert in market economy, but something says me that these bail out moves from US govt and others countries govts, Ru and Kaz include are wrong and undermine any just rulers.

It looks like that govt(no matter whose) support the group of persons who lost their money in casino or similar gambling institutions.

Market players would see here the message: "You can misrule and all your loses will be covered by taxpayers. The only condition - these loses should be counted as catastrophic ( more than several dozens of billions of dollars)"

The Federal Reserve is a private bank protected by the goverment. You really want to know whats going on watch this video.

http://mysticalnights.net/viewtopic.php?f=5&t=730

http://mysticalnights.net/viewforum.php?f=5

And Andrew Jackson is rolling in his grave.

if you really, really want to know what is going on see this. warning a lot of cuss words and far left point of view. quite humorous

http://uk.youtube.com/watch?v=kkQ6IqVdcJ0

I posted the links and watched the video all 3 hrs of it. At the end he explains how to get out of this mess. I guess my question is this a workable solution? If it is, how do we get it done? If we can find answers to engineering problems!! Why can't we get this done? Or have we just committed ourselves to writing posts?

Allen048,

I guess my question is this a workable solution? If it is, how do we get it done? If we can find answers to engineering problems!! Why can't we get this done?

Elections........VOTE.

Or have we just committed ourselves to writing posts?

These posts (website) are tools not answers.

phoenix911

these posts are part of the solution, not part of the problem. therefore they are good. it is when dissent is stifled that tyranny can flourish.

I tried to get away from all of this and decided to watch the Manchester United Vs Chelsea match last night (it was being replayed late at night here in the US) and what is the first thing that I noticed - AIG in big letters on Man U jersey's - upset me so much that I turned off the TV and went to bed.

I guess the American Government is now sponsoring Man U.

Good answer Mr. Hooker.

The govt wanted more low income home owners, and the bankers wanted to make more money. "What strange bedfellows politicians make"

As I heard recently from Paul Harvey,

"Where have all the statesmen gone?"

Good question and highly related to the state of our federal gov't.

Hooker

GA!!

As I've posted, I'm not US citizen and I know little about your institutions and specific rules and laws (other than engineering). But this morning when I went to job hearing to the news in the car radio, they were saying exactly that about the origin of the actual crisis: the 1999 law. And they remarked what you say, the law was approved by Republican controlled Congress and President Clinton.

Kind regards

but at least if government follows a concerted international strategy, then there may be some equity and equality in the outcome rather than unscrupulous individuals making huge proffits at the expense of those less prepared.

But if the result is that we save the companies, the jobs and the shareholders and the "unscrupulous individuals" are having a "margarita" in a tropical beach using those "huge profits", the problem will repeat again and again...

And for all the international participants, remember, "No matter who you vote for in an election, a pollitician wins." The strategies and implementation are (Hopefully) the responsibility of university trained graduates who love their field as much as we love engineering.

Yes, you're right.. a politician always win. Regarding the second part of the paragraph, I would recommend you to investigate the curricula of our politicians (Spanish). You'll be surprised when see that some of them roughly finished the school, some others even passed one or two matters in the first year of university...

But... they win the elections!

And finally one thought:

It seems we are in the 2nd phase of a sort of "wild capitalism". The first as Mr. Marx wrote (I'm not a follower!) was apparently when share holders exploit workers.

Now, apparently, the boards and top management exploit the shareholders.

Kind regards

The shareholders that grabbed the profits earlier should be the ones who now pay the cost.

The problem with this idea is that a lot of the investments are via mutual funds and 401k's. Your solution means that those who plan for retirement are unjustly penalized as they usually have little control over where fund managers put that money.

Our financial system is so massively interlinked that it's nearly impossible to provide for retribution without harming someone who has no knowledge or real responsibility for what's going on.

We either need a major overhaul and simplification of the system, or criminal penalties for those who abuse it. Or, if I had my druthers, BOTH...

Hooker

results are surprising. totaly non scientific, very small group. 3 people so, far. complete consensus. results: prefer that no bailout occur at all. that everyone involved was in it for the money, they should be in it for the losses. let it sink. and here, i thought i was the radical amongst my friends. one also said that the fed should be nationalized and not private (see 1913) and that the treasury should take over the printing of money. i didn't know that the treasury wasn't printing our money??????????????? same person said that the amount of money in play was not 700 billion or 1 trillion, that is just how much this bailout was for. and even that it was not the 11 trillion that i have heard on tv, or the 63 trillion that i have been reading in the blogs, but 4 quadrillion, what ever that is, but it sounds like a lot.

now, none of us 4 are experts. most of us are baby boomers. i am the most liberal. one i am not sure what she would be described as except retired, home owner with no mortgage, married, hates dealing with society all. one is an marine, they don't consider themselves ex marines until they are dead, and a spendaholic. one is a ron paul supporter. so, the poll was across the political spectrum and all came to the same conclusion. i will be out and about this weekend and will ask other people i know and see what the mood is. i have come to the conclusion that no matter what the government does that few of its constituents are going to be pleased.

my own personal belief is that people who are upside down in their mortgages should not profit from their decision to buy more than they can afford. that people who are shareholders of financial institutions bought those shares hopeing to make a profit, well they took a chance and should sink or swim. that the financial institutions that were not conservative and went after the big money should take their lumps. that if need be the financial institutions should be liquidated, their obligations paid, the balance divided among its shareholders, and if their isn't any left over to divide, oh well, that is what bankruptcy is all about. if this sounds harsh, well, no one forced any of those to invest poorly, take risky chances to make big profits. if there was fraud, then prosecute the guilty and confiscate their assets to make restitution.

i believe that peoples savings should come first out of any liquidation. they are the only innocents here.

the latest cumulative numbers are:

8 no bailout what so ever. (note: none had a mortgage) (situations vary from far left to far right, land owners, business owners, working folk).

2 yes (note: one had a mortgage that he did not expect to have to default on, and the other is a complete softie about people in trouble {not disparaging him, he is a dear friend}).

1 vote: i don't know.

Martial law has been enacted.

Good job spending the money like fools.

..at least they are quiet about it.

hello all,

here is a very good read. lists the actual levels of dangerous derivitives. but it still does not encompase the entire problem. it lists 55 trillion dollars of dangerous derivitives, which is more than the the GDP of the US, England and Japan. it does not however talk about the total derivitives market, which means EVERYTHING THAT IS INSURED. that total is 530 trillion dollars. which nobody is talking about. anyway, here it is, it is a good read.

http://www.rense.com/general83/noteno.htm