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People keep saying that the bailout is not good b/c

1. we’re meddling with free market
2. the bailout is really bailing out greedy wall street executives who took big chances with other people’s money… (i.e. no free lunch if you mess up)

I agree with both of them. Heck, I agree with all of the arguments against the $700 billion bailout. But this time, we have to look at the greater picture.

The credit market ONLY works if there’s credit (i.e. people and companies can borrow to buy whatever they need). With no credit, businesses and producers of society cannot have the debt capital to expand their business or acquire assets. The fundamental problem with the real estate bubble is that people borrow to buy liabilities. This credit crunch doesn’t care WHY you are borrowing, just the fact that you ARE borrowing.

If the businesses and investors cannot borrow, they cannot do business. No business, no jobs, This bailout, yes, is equivalent to bailing out someone who drank too much and is about to have a heart attack from the years of damage he has done to his body. People want him to get better, but guess what, he has to LIVE first before any long term repair can be put in place.

Under all other circumstances, I am against ALL forms of gov’t messing with the natural market forces. But clearly, the current situation is beyond any regular player in the natural market can do. The only player left, unfortunately, is Uncle Sam.

It’s very simple folks: either we pay more taxes or we go into a very long depression. Your choice.

PS: By the way, if you have 401k, pension plan, life insurance, or any long term investments, it’s in your best interest to support this… why? Read this.

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When WAMU stock first tanked from 60 bucks to 3 bucks, that’s when I started to get a notice… thinking “ah crap, bank failure, here we come” I’m not afraid of banks failing… but what I afraid of is the damn herding effect. It’s not the actual event, but the response from the masses.

If I watch a movie and someone screams out fire, I’m not really afraid of the fire. I’m afraid of the idiots screaming and running, trampling all over me and whoever I’m with. The only reason I would run is to make sure I don’t get run over.

When the stock tanked to $3, I wasn’t worried about getting my money out more so I was worried about what the masses would do. In my branch, i was the second person that month to ask for entire balance of account. Sure, though it’d be measly tiny (for now), but shoot, it was MY money. The dude asked me why I’m taking it out. I should’ve replied “sex change operation” so they don’t give me a whole slew of sales pitches on why I should stay. Never knew taking money out of a failing bank could be so rough.

I still had 19 bucks in my account (thanks to stupid PayPal and their delayed everything, but that’s another post) so I figured, shoot, it’s not life savings but I want to eat lunch today. So I went. The branch I go to is really tiny (maybe 500 sq. ft or so) and it was JAM packed. I waited at least 15 minutes, when usually, the wait is about 1-3 minutes. And it wasn’t over. When I was ahead of the line, the line behind me got LONGER. People were nervously filling out withdrawal forms or what not. Then the dreaded words from the teller

Sorry. There’s a stop on withdrawals.

I am not sure if he meant a stop on that particular person’s account … or stop on 100% (or some significant) withdrawals.. but those words made people stop what they were doing and look at that teller.

I’m guessing it’s probably nothing since I did get my 18 bucks (I wanted to leave $1 so I can keep my free WAMU account open) but damn, the line got longer and longer.

I don’t know what’s wiser: being calm + patient or predicting trends and acting on it when the eye of the storm is scaring the herd. Maybe I’ll spend $18 bucks printing + mailing flyers to other WAMU customers to leave while they can. *muahahha* (evil grin)

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