CHESSNOID

Let’s be honest, the bailouts have not and will not work.  Most Americans were against this plan and now after half of it spent with poor results, I can’t understand why Congress continues on the same path to failure.  This plan called TARP should be called CRAP, because that is what it is.  Originally, TARP had a goal but now it is just a bunch of failed companies trying to get its tainted hands on taxpayer money.

Here is an overview of some of the basics of the bill:

Buying Mortgages

The bill gives the Treasury secretary up to $700 billion to buy mortgages and other troubled assets owned by financial institutions under a new Troubled Asset Relief Program or TARP.

The Treasury Department will immediately receive $250 billion to begin the program.

An additional $100 billion will be provided if the president certifies that the money is necessary.

An additional $350 billion will be provided if the president certifies that the money is necessary and if the Congress approves of funding.

The bill also establishes a program to allow the government to insure, instead of buying, some troubled assets held by banks.

The bill establishes an oversight board to monitor the Treasury’s use of the funds.
The bill allows the Treasury to establish rules limiting executive compensation, bonuses, “golden parachutes” and other incentives at institutions participating in TARP.

Participating institutions will also lose certain tax benefits related to compensation.

Not one penny was spent on buying mortgages or other troubled assets. CEO’s did get money that was used for compensation from these funds. This is why a majority of Americans were and are still against these FRAUD bailouts.

Where does the economy stand now after all this money has been legally stolen?  Have we stopped the housing bust?

NEW YORK (CNNMoney.com) —

U.S. foreclosure filings spiked by more than 81% in 2008, a record, according to a report released Thursday, and they’re up 225% compared with 2006.

A total of 861,664 families lost their homes to foreclosure last year, according to RealtyTrac, which released its year-end report Thursday. There were more than 3.1 million foreclosure filings issued during 2008, which means that one of every 54 households received a notice last year.

“Clearly the foreclosure prevention programs implemented to date have not had any real success in slowing down this foreclosure tsunami,” said James Saccacio, CEO of RealtyTrac in a statement.

The price of houses  continue to plummet and the inventory of bank foreclosures continue to skyrocket. The banks themselves are starting to become bankrupt and continue to ask for more bailout money, yet that doesn’t solve their problems. The prices of homes in certain areas are absurdly low.

NEW YORK (CNNMoney.com) —

The real estate market is so awful that buyers are now scooping up homes for as little as $1,000.

There are 18 listings in Flint, Mich., for under $3,000, according to Realtor.com. There are 22 in Indianapolis, 46 in Cleveland and a whopping 709 in Detroit. All of these communities have been hit hard by foreclosures, and most of these homes are being sold by the lenders that repossessed them.

“Foreclosures have turned banks into property management companies,” said Heather Fernandez, a spokeswoman for Trulia.com, the real estate Web site. “And it’s often cheaper for them to give these homes away rather than try to get market value for them.”

For now these are just small pockets where prices have completely collapsed in America, but this could be a trend that grows and starts to spread nationally.  Those areas with crazy prices are areas hit with high unemployment and companies closing down completely.

Unemployment is expected to go higher in the next 2 years and more companies closing are expected to continue even under the new Obama stimulus plan. I know we heard Obama’s speeches about creating a million, 3 million, and now even up to 4 million theoretical jobs depending which speech you listened too. The 14 page report is available online and a generality of what they possibly expect if they spent a trillion dollars. It is not a plan but only a theory and that is why the numbers keep bouncing up to serve the needs of Hope and doesn’t produce real solutions .

NY Times:

In the campaign, Mr. Obama vowed to create one million jobs, and after winning election he put forth a plan to create up to three million. The report now puts the figure at roughly 3.7 million, the midpoint of an estimated range of 3.3 million to 4.1 million jobs by the end of next year.

So far the bailouts have not worked. Now that we can read what the new stimulus package is. The pep rally speeches are not convincing many economists and analysts because they know it won’t work.  The numbers don’t make sense because they are not real.

If you review current spending, you will see the same actions will produce the same results. It doesn’t matter if you are Bush or Obama, giving stimulus checks and making tax cuts are not the solution, nor is writing checks to failing bankrupt companies (Bush has already done all that). 

Time:

You have probably read about the $700 billion approved by Congress in a contentious vote in early October. But that’s only the most public portion of the money the government is shelling out to restart the nation’s stalled financial system. In the past 16 weeks, the government has pledged, loaned or invested some $10 trillion to fix ailing banks, jump-start financial markets and keep the automakers from bankruptcy.

So what is the solution? We could start by stopping wasteful government spending and balancing the
budget.  Ron Paul:

Ron Paul video with real solutions.

Transcript:

“This continued debate that has gone on about our rescue programs that we have been devising is confirmation, I believe, that there’s very little understanding as to how we got into this mess. As long as we continue to do the wrong things I don’t see any solution.

But if we got here by spending too much money, borrowing too much money, inflating too much money, the Federal Reserve too involved in central economic planning through manipulation of interest rates, and the Congress passing too many regulations, as long as we think that’s benign and has nothing to do with it, then I guess it seems very logical that we come up by spending more money, borrowing more money, printing more money, and writing more regulations, and think that we’re going to get different results, but we don’t.

It seems to be today that the big argument is who the central economic planner is. Is it the treasury, is it the Congress, is it the FDIC, is it the Federal Reserve? Believe me, central economic planning doesn’t work, that’s why we’re in this mess. And that’s why we have all the malinvestment, all the bad debt.

If we’re looking for a solution we have to have liquidation of debt, we don’t want to prop up the bad debt. The problem was created by bad policy, but long as you delay the liquidation of debt and the malinvestment, the longer the agony will be.

But to now devise a system where we’re going to buy up these bad assets, these worthless assets and dump them on the American taxpayer is absurd. It makes no sense whatsoever. What we need is a little bit of confidence that a market economy works and get away from this central economic planning and quit arguing over who’s going to be the central economic planner.

Believe me, it doesn’t work. It’s been tried. The 20th century was supposed to have proven that it doesn’t work.

But here we are, we’ve given up on it. More government, more spending and more debt.”