I entered Wall Street in 1956. Banker's Trust, then Ball, Burge & Krause in Cleveland. Reynolds Securities, Oppenheimer, Drexel and Dean Witter. The old Wall Street was privately owned. The top tier of ownership made up to 30% on their equity--the middle group ranged up to 15%. They were risk adverse. Leverage over 3-to-1 was considered speculative. Mike Milken introduced cash flow equity. But, he too was risk adverse.
Merrill Lynch demanded negotiated rates. The old timers cashed in and fled. Public ownership followed. A young breed of business schoolers replaced the old timers. Greenspan made cheap money available. The new group arbitraged the spread between government money and what the market would bear. New and unintelligible products replaced traditional investing.
The youngsters made millions--far beyond the modest profits of prior bankers. Ponzi ruled. The government provided the tulips.
Then, like dancing school, the music stopped and with one chair short, a domino effect crashed the market. Each day another entity caught short. Short sellers ruled. Hedge funds turned to commodities--the riskiest of all investments. That bubble burst. The government called in markers. Bernanke/Paulson faced Greenspan's profligacy. His double speak was revealed. Where will it end?
Perhaps reality has brought us new leadership. The 2008 election may be the most important in our lifetime.
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Fantastic summary! Now the public, as measured by the latest ABC poll, has greater faith in Sen. Obama to resolve this crisis over Sen. McCain - by a margin of 53 to 47.
There is only one reason for this. It certainly is not Obama's experiance in similar situations, there simply is no record of that. What we have seen, thanks to Obama and his supporters in the media, are many film clips and pictures of Obama and ny many clips of Obama sitting at the round table with top finanacial leaders! This suggests a brainstroming session (but there lips were not moving). A picture is worth a thousand words. There has been no clips or pics of McCain sitting at the round table with any financial leaders.
I'm against the 700 billion dollar bailout of the banks.
Instead, I'm in favor of giving $85,000,000,000 to America in a "The We Deserve It Dividend".
To make the math simple, let's assume there are 200,000,000 bona fide U.S. Citizens 18+.
Our population is about 301,000,000 +/- counting every man, woman and child. So 200,000,000 might be a fair stab at adults 18 and up.
So divide 200 million adults 18+ into $85 billon that equals $425,000.
Give $425,000 to every person 18+ as a "We Deserve It Dividend".
Of course, it would NOT be tax free. So let's assume a tax rate of 30%.
Every individual 18+ has to pay $127,500.00 in taxes.
That sends $25,500,000,000 right back to Uncle Sam. But it means that every adult 18+ has $297,500 in their pocket. A husband and wife has $595,000.
What would you do with $297,500 to $595,000 in your family?
Pay off your mortgage - housing crisis solved.
Repay college loans - what a great boost to new grads
Put away money for college - it'll be there
Pay off all your consumer debt.
If we're going to re-distribute wealth let's really do it.
If we're going to do a bailout, let's bail out every adult US Citizen 18+!
Sure it's a crazy idea that can "never work."
But can you imagine the Coast-To-Coast Block Party! How do you spell Economic Boom?
I trust my fellow adult Americans to know how to use the "We Deserve It Dividend" more than I do the geniuses in Washington DC .
And remember, The Family plan only really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam.
The rules:
The use of funds must go first to your mortgage.
Any surplus funds must go to pay consumer debt.
If there are still funds left over, it must be invested in an IRA to provide for retirement.
If the money doesn’t pay off the entire mortgage, it will build sufficient equity so that the banks can renegotiate a mortgage and shall be required to do so on fixed 30 year terms. This will solve the mortgage problem. It will enhance rather than destroy the financial structure and well being of the American people. If we the people are going to borrow so much to bail out someone lets bail out we the people.
If you think this could work please forward this idea to anyone you think might help.
I will be honest - McCain's latest behavior worries me. It sounded like we had some sort of bipartisan solution to this mess - before the markets crash - then he suddenly "stops his campaign" to be the hero, and now mysteriously some republicans are against the plan and mess up the whole thing. It seems like presidential politics getting in the way of what is best for the country. Now don't get me wrong - I'm a republican myself, and generally support McCain - but this just seems like poor behavior from a future leader of our country.
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