Democracy still works. Bill a no go

[NorthernMonkey]

hmmm, the markets dont seem to be doing to bad today do they. maybe thats because this whole things is a big fraud. the market is going through a realignment and doesn't need george bushes stimulating package after all. what a suprise.

They are recovering SLIGHTLY because there is further talk of action - probably a repackaged bail-out. If that fails they'll plummet again.

its scare mongering, the market needs to correct, it will do so, some will go out of business. and so they should. pumping money into a dead monkey doesn't bring it back to life. t makes it eyes pop out of its head and blood spew from its simian rectum . If this bill passes it will be 10 times worse than if it doesn't.

Same question - what is your exposure, experience and knowledge of financial markets based on? Do you work in the industry?

BTW, the reason I ask is because you're just making statements in the same way as deva without backing up your views with anything concrete.

[Machinesworking]

Correct. Stock prices are falling because investors are losing faith in the markets (and have huge concerns about the bad debts floating around a lot of companies) - sure you could buy low, but who's going to buy high if no-one's investing? The risk is do you hold onto them and hope they go up in value when the markets recover or lose your investment because the companies you invested in have collapsed?

Re: the only stock I own. Apple.

Right now if you buy Apple stock I can see ZERO way you would come out a loser, it was at $123 a year ago, it's fallen a little under that, the reality is Apple will not be hurt by global market collapse, and there is almost no way that this stock won't go at least back up to $150, if not it's high of $200.
Personally I'm trying to figure out a way to justify it myself.
It's not as bleak as people make it out to be, just be smart about it, that's all. Apple have been undervalued for quite some time actually.

[Emissary]

They are recovering SLIGHTLY because there is further talk of action - probably a repackaged bail-out. If that fails they'll plummet again.

its scare mongering, the market needs to correct, it will do so, some will go out of business. and so they should. pumping money into a dead monkey doesn't bring it back to life. t makes it eyes pop out of its head and blood spew from its simian rectum . If this bill passes it will be 10 times worse than if it doesn't.

Same question - what is your exposure, experience and knowledge of financial markets based on? Do you work in the industry?

nope its a hobby. I see this has no relevance to my opinions though, or do you disagree. Must i have worked as an economist to understand.

I think the following people would back me up here though.

Acemoglu Daron (Massachussets Institute of Technology)
Adler Michael (Columbia University)
Admati Anat R. (Stanford University)
Alexis Marcus (Northwestern University)
Alvarez Fernando (University of Chicago)
Andersen Torben (Northwestern University)
Baliga Sandeep (Northwestern University)
Banerjee Abhijit V. (Massachussets Institute of Technology)
Barankay Iwan (University of Pennsylvania)
Barry Brian (University of Chicago)
Bartkus James R. (Xavier University of Louisiana)
Becker Charles M. (Duke University)
Becker Robert A. (Indiana University)
Beim David (Columbia University)
Berk Jonathan (Stanford University)
Bisin Alberto (New York University)
Bittlingmayer George (University of Kansas)
Boldrin Michele (Washington University)
Brooks Taggert J. (University of Wisconsin)
Brynjolfsson Erik (Massachusetts Institute of Technology)
Buera Francisco J. (UCLA)
Camp Mary Elizabeth (Indiana University)
Carmel Jonathan (University of Michigan)
Carroll Christopher (Johns Hopkins University)
Cassar Gavin (University of Pennsylvania)
Chaney Thomas (University of Chicago)
Chari Varadarajan V. (University of Minnesota)
Chauvin Keith W. (University of Kansas)
Chintagunta Pradeep K. (University of Chicago)
Christiano Lawrence J. (Northwestern University)
Cochrane John (University of Chicago)
Coleman John (Duke University)
Constantinides George M. (University of Chicago)
Crain Robert (UC Berkeley)
Culp Christopher (University of Chicago)
Da Zhi (University of Notre Dame)
Davis Morris (University of Wisconsin)
De Marzo Peter (Stanford University)
Dubé Jean-Pierre H. (University of Chicago)
Edlin Aaron (UC Berkeley)
Eichenbaum Martin (Northwestern University)
Ely Jeffrey (Northwestern University)
Eraslan Hülya K. K.(Johns Hopkins University)
Faulhaber Gerald (University of Pennsylvania)
Feldmann Sven (University of Melbourne)
Fernandez-Villaverde Jesus (University of Pennsylvania)
Fohlin Caroline (Johns Hopkins University)
Fox Jeremy T. (University of Chicago)
Frank Murray Z.(University of Minnesota)
Frenzen Jonathan (University of Chicago)
Fuchs William (University of Chicago)
Fudenberg Drew (Harvard University)
Gabaix Xavier (New York University)
Gao Paul (Notre Dame University)
Garicano Luis (University of Chicago)
Gerakos Joseph J. (University of Chicago)
Gibbs Michael (University of Chicago)
Glomm Gerhard (Indiana University)
Goettler Ron (University of Chicago)
Goldin Claudia (Harvard University)
Gordon Robert J. (Northwestern University)
Greenstone Michael (Massachusetts Institute of Technology)
Guadalupe Maria (Columbia University)
Guerrieri Veronica (University of Chicago)
Hagerty Kathleen (Northwestern University)
Hamada Robert S. (University of Chicago)
Hansen Lars (University of Chicago)
Harris Milton (University of Chicago)
Hart Oliver (Harvard University)
Hazlett Thomas W. (George Mason University)
Heaton John (University of Chicago)
Heckman James (University of Chicago - Nobel Laureate)
Henderson David R. (Hoover Institution)
Henisz, Witold (University of Pennsylvania)
Hertzberg Andrew (Columbia University)
Hite Gailen (Columbia University)
Hitsch Günter J. (University of Chicago)
Hodrick Robert J. (Columbia University)
Hopenhayn Hugo (UCLA)
Hurst Erik (University of Chicago)
Imrohoroglu Ayse (University of Southern California)
Isakson Hans (University of Northern Iowa)
Israel Ronen (London Business School)
Jaffee Dwight M. (UC Berkeley)
Jagannathan Ravi (Northwestern University)
Jenter Dirk (Stanford University)
Jones Charles M. (Columbia Business School)
Kaboski Joseph P. (Ohio State University)
Kahn Matthew (UCLA)
Kaplan Ethan (Stockholm University)
Karolyi, Andrew (Ohio State University)
Kashyap Anil (University of Chicago)
Keim Donald B (University of Pennsylvania)
Ketkar Suhas L (Vanderbilt University)
Kiesling Lynne (Northwestern University)
Klenow Pete (Stanford University)
Koch Paul (University of Kansas)
Kocherlakota Narayana (University of Minnesota)
Koijen Ralph S.J. (University of Chicago)
Kondo Jiro (Northwestern University)
Korteweg Arthur (Stanford University)
Kortum Samuel (University of Chicago)
Krueger Dirk (University of Pennsylvania)
Ledesma Patricia (Northwestern University)
Lee Lung-fei (Ohio State University)
Leeper Eric M. (Indiana University)
Leuz Christian (University of Chicago)
Levine David I.(UC Berkeley)
Levine David K.(Washington University)
Levy David M. (George Mason University)
Linnainmaa Juhani (University of Chicago)
Lott John R. Jr. (University of Maryland)
Lucas Robert (University of Chicago - Nobel Laureate)
Luttmer Erzo G.J. (University of Minnesota)
Manski Charles F. (Northwestern University)
Martin Ian (Stanford University)
Mayer Christopher (Columbia University)
Mazzeo Michael (Northwestern University)
McDonald Robert (Northwestern University)
Meadow Scott F. (University of Chicago)
Mehra Rajnish (UC Santa Barbara)
Mian Atif (University of Chicago)
Middlebrook Art (University of Chicago)
Miguel Edward (UC Berkeley)
Miravete Eugenio J. (University of Texas at Austin)
Miron Jeffrey (Harvard University)
Moretti Enrico (UC Berkeley)
Moriguchi Chiaki (Northwestern University)
Moro Andrea (Vanderbilt University)
Morse Adair (University of Chicago)
Mortensen Dale T. (Northwestern University)
Mortimer Julie Holland (Harvard University)
Muralidharan Karthik (UC San Diego)
Nanda Dhananjay (University of Miami)
Nevo Aviv (Northwestern University)
Ohanian Lee (UCLA)
Pagliari Joseph (University of Chicago)
Papanikolaou Dimitris (Northwestern University)
Parker Jonathan (Northwestern University)
Paul Evans (Ohio State University)
Pejovich Svetozar (Texas A&M University)
Peltzman Sam (University of Chicago)
Perri Fabrizio (University of Minnesota)
Phelan Christopher (University of Minnesota)
Piazzesi Monika (Stanford University)
Piskorski Tomasz (Columbia University)
Rampini Adriano (Duke University)
Reagan Patricia (Ohio State University)
Reich Michael (UC Berkeley)
Reuben Ernesto (Northwestern University)
Roberts Michael (University of Pennsylvania)
Robinson David (Duke University)
Rogers Michele (Northwestern University)
Rotella Elyce (Indiana University)
Ruud Paul (Vassar College)
Safford Sean (University of Chicago)
Sandbu Martin E. (University of Pennsylvania)
Sapienza Paola (Northwestern University)
Savor Pavel (University of Pennsylvania)
Scharfstein David (Harvard University)
Seim Katja (University of Pennsylvania)
Seru Amit (University of Chicago)
Shang-Jin Wei (Columbia University)
Shimer Robert (University of Chicago)
Shore Stephen H. (Johns Hopkins University)
Siegel Ron (Northwestern University)
Smith David C. (University of Virginia)
Smith Vernon L.(Chapman University- Nobel Laureate)
Sorensen Morten (Columbia University)
Spiegel Matthew (Yale University)
Stevenson Betsey (University of Pennsylvania)
Stokey Nancy (University of Chicago)
Strahan Philip (Boston College)
Strebulaev Ilya (Stanford University)
Sufi Amir (University of Chicago)
Tabarrok Alex (George Mason University)
Taylor Alan M. (UC Davis)
Thompson Tim (Northwestern University)
Tschoegl Adrian E. (University of Pennsylvania)
Uhlig Harald (University of Chicago)
Ulrich, Maxim (Columbia University)
Van Buskirk Andrew (University of Chicago)
Veronesi Pietro (University of Chicago)
Vissing-Jorgensen Annette (Northwestern University)
Wacziarg Romain (UCLA)
Weill Pierre-Olivier (UCLA)
Williamson Samuel H. (Miami University)
Witte Mark (Northwestern University)
Wolfers Justin (University of Pennsylvania)
Woutersen Tiemen (Johns Hopkins University)
Zingales Luigi (University of Chicago)
Zitzewitz Eric (Dartmouth College)

and the letter they all signed here

http://faculty.chicagogsb.edu/john.coch ... rotest.htm

[NorthernMonkey]

Correct. Stock prices are falling because investors are losing faith in the markets (and have huge concerns about the bad debts floating around a lot of companies) - sure you could buy low, but who's going to buy high if no-one's investing? The risk is do you hold onto them and hope they go up in value when the markets recover or lose your investment because the companies you invested in have collapsed?

Re: the only stock I own. Apple.

Right now if you buy Apple stock I can see ZERO way you would come out a loser, it was at $123 a year ago, it's fallen a little under that, the reality is Apple will not be hurt by global market collapse, and there is almost no way that this stock won't go at least back up to $150, if not it's high of $200.
Personally I'm trying to figure out a way to justify it myself.
It's not as bleak as people make it out to be, just be smart about it, that's all. Apple have been undervalued for quite some time actually.

I understand your point but those share prices could carry on falling and no-one can say for any certainty what will happen to any company or if the share price will ever recover. If you're going to invest, always ensure it's money you can afford to lose, especially when the markets are as volatile as they are right now.

[NorthernMonkey]

Must i have worked as an economist to understand.

No, but you appear to have strong views apparently based on nothing more than a random internet webpage.

[deva]

BTW, the reason I ask is because you're just making statements in the same way as deva without backing up your views with anything concrete.

ha! I've backed it up with plenty... I've posted dozens of links over the past week... but of course that does not matter, you just want to find someway to discredit..

[deva]

nope its a hobby. I see this has no relevance to my opinions though, or do you disagree. Must i have worked as an economist to understand.

Actually, working in the industry is a handicap to understanding. Insiders are steeped in the dogma that has been spread in order to mask the theft going on. And of course many people do not want to admit to themselves that they have helped the whole thing happen.

Paulson was saying just weeks ago that everything was fine, the worst was past and so on. Same thing with Bernanke. These guys are clueless or liars. Either way they cannot be trusted.

[Emissary]

nope its a hobby. I see this has no relevance to my opinions though, or do you disagree. Must i have worked as an economist to understand.

Actually, working in the industry is a handicap to understanding. Insiders are steeped in the dogma that has been spread in order to mask the theft going on. And of course many people do not want to admit to themselves that they have helped the whole thing happen..

i thought as much.

[Emissary]

Must i have worked as an economist to understand.

No, but you appear to have strong views apparently based on nothing more than a random internet webpage.

Sorry, i could give you a Hell of alot more random pages if you want. I don't pretend to know everything about how the stock market works. BUT i do read what the experts say on both sides of the fence. When it comes down to Paulson, Bush and bernanke vs ron paul. i dont think there is any sane man who would choose the path that those 3 lunatics want, over the path offered up by not only ron paul, but many well respected economists.

i will give you some more "random" web pages now

http://www.zogby.com/Soundbites/ReadClips.dbm?ID=18369
http://news.yahoo.com/s/politico/200809 ... tico/13689
http://www.bloomberg.com/apps/news?pid= ... vlLMejTsM0
http://krugman.blogs.nytimes.com/2008/0 ... /#more-906
http://www.washingtonpost.com/wp-dyn/co ... v=hcmodule
http://www.cnbc.com/id/26441422
http://abcnews.go.com/print?id=5887486
http://www.rgemonitor.com/roubini-monit ... _is_flawed
http://www.ndn.org/ndnthinking/keeppeop ... rhomes.pdf

and a video of ron paul giving bernanke a telling off

http://www.youtube.com/watch?v=dv6rQ0U0 ... ef=profile

[ethios4]

My other question, and this is gonna sound really dumb, is.... where does the money go if you take a loss on stocks? For example, say I have $1000 worth of stock in a company. The next day it is worth $600. Where does that $400 go? Is it just lost? Does the stock market destroy money?

To answer your question, the $1000 of stock you own has a valuation of $1000 - you will only realise the true worth when you sell it. If you bought a property for $200,000 and a year later it was valued at $250,000 and a year later you sold it for $150,000 (because that was the maximum offered for it), you have lost $50,000 of your initial investment.

Yes, yes, ok it makes sense again. I had forgotten that is about the buying and selling. Whew, for a second I had no idea what was going on anymore!

[deva]

The Shadow of the Pitchfork: Elite Panic Attack as Bailout Goes Bust
Written by Chris Floyd

The vote by the House of Representatives to defeat the Wall Street bailout plan is the first act of political courage that the Congress of the United States has mounted in the last seven years. The fact that it was due largely to right-wing Republicans afraid of going down with the sinking ship of the witless leader they have followed blindly throughout his reign is a delicious irony -- but the whys and wherefores of the vote are not important. What matters is that one of America's moribund institutions has flickered to life long enough to derail a disastrous action that would have shoved the nation even deeper into the pit of corruption and ruin where it has been mired for so long.

The New York Times called the House vote "a catastrophic political defeat for President Bush, who had put the full weight of the White House behind the measure." But this is manifestly untrue. As everyone but the nation's media -- and the Democratic Party -- knows, George W. Bush has no "political weight" to use, or lose. Yes, he still retains the authoritarian powers that the spineless Democrats have given him with scarcely a whimper of protest (and often with boundless enthusiasm); but as a political force -- i.e., someone whose opinions and statements can sway popular opinion -- he has been a dead and rotting carcass for a long time. He is the most unpopular president in American history; and I can report from first-hand, eyewitness knowledge that he is thoroughly despised by some of the most rock-ribbed, Bible-believing, flag-waving, down-home, John Wayne-loving Heartland types that you can imagine. Even his own party -- a party fashioned in his own image, the Frankensteinian melding of willfully ignorant religious primitivism and rapaciously greedy crony capitalism that he has embodied in his twerpish person -- kept him away from their convention this year.

Nothing -- absolutely nothing -- could be politically safer than opposing George W. Bush. And yet the entire Democratic leadership, Barack Obama included, lined up to support a cockamamie plan proposed by this scorned and shriveled figure, a plan that was transparently nothing more than an audacious raid on the Treasury by Big Money hoods and yet another authoritarian power grab by a gang of murderous, torturing, warmongering toadies. This was the plan and these were the people that the Democrats decided to fight for.

What's more, the Democrats stood shoulder to shoulder with the president on what is apparently the only issue that can now stir Americans to genuine anger and widespread protest: a direct threat to their bank accounts. Wars of aggression like the Nazis used to wage; elaborate tortures like the KGB used to practice; concentration camps, lawbreaking leaders, diminishment of liberty, the slaughter of a million innocent people in a land destroyed by an illegal and pointless invasion -- all of that stuff is pretty much OK, easily swallowable, worth no more than a shrug or perhaps a frowny "tsk tsk" before going on to the sports pages or flipping over to another channel. But put out an open ploy to steal their money and give it to the filthy rich -- and baby, it's pitchfork time! Yet here, as the public face of just such a ploy, is where the Democrats chose to make their stand.

So Monday's rejection of the bailout plan is not a catastrophic political defeat for George W. Bush; he has no political standing, no political future. But it is a vast and humiliating defeat for the Democratic leadership, across the board, who, as Democrat Lloyd Dogget of Texas said

“never seriously considered any alternative” to the administration’s plan, and had only barely modified what they were given. He criticized the plan for handing over sweeping new powers to an administration that he said was to blame for allowing the crisis to develop in the first place.

Now the Democratic elites have had their collective head handed to them on a platter. It is a dish most richly deserved. And although it is almost possible to believe that they will learn anything from this episode, there is now a chance -- a chance -- that we can at least have a discussion of alternatives to the Bush scheme.

I still believe it is unlikely any genuinely effective program -- one that could manage and mitigate the now-unavoidable effects of the Wall Street/Washington-induced disaster -- will ever get enacted. After all, the Democrats are largely owned by the same corrupt and greedy elites now seeking a handout. And it seems reasonable to assume that the Bipartisan Bailout Bunch will eventually find some kind of sugar to tempt away the two dozen votes they need for their next "compromise" on the Bush-Paulson plan.

Then again, who knows? There are obviously a lot of very powerful and privileged people sweating more bullets tonight than they have sweated in many and many a year. They have roused the drowsy beast of popular anger at last, and no one can say what might happen next. Probably nothing -- or rather, more of the same, in some form or another. But still, it is good to see the icy beads of panic dotting the brows of elites who have inflicted and/or countenanced so much death, destruction, terror and degradation in the past few years. Today they have suffered a very rare defeat in the relentless, remorseless class war they have been waging against us for decades. And that is something to celebrate -- at least for one night.

[Machinesworking]

and a video of ron paul giving bernanke a telling off

http://www.youtube.com/watch?v=dv6rQ0U0 ... ef=profile

Wow? Did bernanke really say at the end that he could just get the Federal Reserve to print more money???

We're fucked whether he gets his money or not. I'm more and more thoroughly convinced that it's not some grand cartel that's running things etc. in some sort of conspiracy theory way, but total and complete idiot mommas boys bumbling along with half a clue making the rest of us go along with them, and their driving sucks.

I understand your point but those share prices could carry on falling and no-one can say for any certainty what will happen to any company or if the share price will ever recover. If you're going to invest, always ensure it's money you can afford to lose, especially when the markets are as volatile as they are right now.

Honestly I don't buy it, I agree that the possibility is there that US or world wide depression is possible with these banks falling, but it's also more than likely that it creates a momentary blip in the economy, yet is being used as a stage for hand outs. Really, exactly what is 700 billion in relation to average worldwide gross product?
To me, those hand outs are going to prevent the laws from changing favorably, it's a band aid on a machete wound that was created by greed at it's worst IMO.

BTW Apple went up 9$ a share in the time we've had this conversation. I have no doubt that it will go up to at least 135 by next month. Some companies will survive a depression, and any company in the entertainment business is a good investment in hard times.

[deva]

I understand your point but those share prices could carry on falling and no-one can say for any certainty what will happen to any company or if the share price will ever recover. If you're going to invest, always ensure it's money you can afford to lose, especially when the markets are as volatile as they are right now.

Honestly I don't buy it, I agree that the possibility is there that US or world wide depression is possible with these banks falling, but it's also more than likely that it creates a momentary blip in the economy, yet is being used as a stage for hand outs. Really, exactly what is 700 billion in relation to average worldwide gross product?

All but un-noticed in all the talk about the bill, is that the Fed gave a trillion dollars to the banks in 1 week. More than the whole so called bailout bill!!!!

They are printing vast sums of money (printing is a loose term these days)

[oblique strategies]

"Public Outcry Forces House to Reject $700 Billion Bailout of Financial Industry; Dow Falls Record 777 Points"

What if it had fallen 666 points? Could you imagine the fun people would have had with that?

[NorthernMonkey]

BTW Apple went up 9$ a share in the time we've had this conversation. I have no doubt that it will go up to at least 135 by next month. Some companies will survive a depression, and any company in the entertainment business is a good investment in hard times.

You may well be correct, in fact if you get in early enough you might make a lot of money. Of course you'll then have deva hunting you down to string you up for even daring to suggest capital gain is healthy. Thanks for adding some reasoned debate though, it was getting a bit silly in here.