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Arthur Dent wrote:

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That's an imperfect analogy. Greenspan could've made a boatload more money if he had left public service. He really was blind rather than cynical.

Real estate was a huge pyramid scheme. As some blogger put it, subprime should've been the signal that the pyramid was about to collapse, because taxi drivers and day laborers always will be the last ones in. <Insert Joseph Kennedy-shoeshine boy story here.> If you want to blame somebody, try Reagan, Clinton and everybody else who let east Asia build huge trade surpluses against the US, which were offset by debt flows through our capital markets. That's been a substantial driver of our phony economic growth. It's the goofiest thing, and by the end some poor factory worker in the Guangdong province was underpaid so some unemployed dude in Phoenix could get a negatively amortizing loan to buy a million dollar home. Freddie Mac and Fannie Mae facilitated the pyramid scheme, and CRA extended it, but it's not like anybody in this country had the political will to stop it. Judging by Obama's housing plan, Hillary's tour of China, and the AIG and Citi rumors, we still don't have the will to stop it.

dangerous wrote:Copper prices often move opposite to bond prices but nowadays copper moves opposite the piece of paper with George Washington's picture on it.

I always figured Washington and Lincoln didn't get along.

Arthur Dent wrote:

docellis wrote:What if, instead of this bailout plan, the government forced all banks to cut all mortgage payments in half?

Why do you think that this would be helpful?

I don't know if it would be. Someone last night was arguing that if everyone had half their mortgage payment people would start spending and saving...that giving banks money was useless because it wouldn't really affect people in any meaningful way. He was adamant about it.

docellis wrote:

Arthur Dent wrote:

docellis wrote:What if, instead of this bailout plan, the government forced all banks to cut all mortgage payments in half?

Why do you think that this would be helpful?

I don't know if it would be. Someone last night was arguing that if everyone had half their mortgage payment people would start spending and saving...that giving banks money was useless because it wouldn't really affect people in any meaningful way. He was adamant about it.

What if you don't have a mortgage? You'd be getting screwed.

docellis wrote:

Arthur Dent wrote:

docellis wrote:What if, instead of this bailout plan, the government forced all banks to cut all mortgage payments in half?

Why do you think that this would be helpful?

I don't know if it would be. Someone last night was arguing that if everyone had half their mortgage payment people would start spending and saving...that giving banks money was useless because it wouldn't really affect people in any meaningful way. He was adamant about it.

I think that person was probably insane. The effects would be catastrophic - home values would plummet and even people paying only half what they were before would be underwater, inflation would reach astronomical highs, there would be a run on the banks because all the assets backing that money would cease to have any value. There would likely be a revolution in this country in a matter of days.

maddash wrote:

docellis wrote:

Arthur Dent wrote:

docellis wrote:What if, instead of this bailout plan, the government forced all banks to cut all mortgage payments in half?

Why do you think that this would be helpful?

I don't know if it would be. Someone last night was arguing that if everyone had half their mortgage payment people would start spending and saving...that giving banks money was useless because it wouldn't really affect people in any meaningful way. He was adamant about it.

I think that person was probably insane. The effects would be catastrophic - home values would plummet and even people paying only half what they were before would be underwater, inflation would reach astronomical highs, there would be a run on the banks because all the assets backing that money would cease to have any value. There would likely be a revolution in this country in a matter of days.

I think reality would be closer to this than fixing the problem.

fwiw,

B Of A Heiress Blasts Bank Leaders As 'Idiots'

The granddaughter of the man who founded Bank of America in San Francisco in the early 1900s called the bank's current condition "totally repulsive" and blasted the bank's management for being "idiots."

The harsh criticism from Virginia Hammerness, the heiress to A.P. Giannini's family fortune and a significant stockholder in the bank he launched, came during an interview Monday with CBS 5.

When asked if she still puts her money in the Bank of America, the Giannini heiress responded: "Well, of course. But I have no loyalty to it. It's just there because I'm too lazy to go somewhere else... That's the honest to God truth, just too lazy to move it somewhere else."

http://cbs5.com/business/bank.of.america.2.942327.html

Jocephus wrote:fwiw,

B Of A Heiress Blasts Bank Leaders As 'Idiots'

The granddaughter of the man who founded Bank of America in San Francisco in the early 1900s called the bank's current condition "totally repulsive" and blasted the bank's management for being "idiots."

The harsh criticism from Virginia Hammerness, the heiress to A.P. Giannini's family fortune and a significant stockholder in the bank he launched, came during an interview Monday with CBS 5.

When asked if she still puts her money in the Bank of America, the Giannini heiress responded: "Well, of course. But I have no loyalty to it. It's just there because I'm too lazy to go somewhere else... That's the honest to God truth, just too lazy to move it somewhere else."

http://cbs5.com/business/bank.of.america.2.942327.html

I'm glad she put down the martini long enough to comment.

The Five 'M's of Picking Gold Mining Stocks

http://seekingalpha.com/article/122369- ... ing-stocks