“Rescue Plan” Passes The House

Oct 3rd, 2008 @ 5:04 PM by Alden Smith

One has to wonder if the so-called “rescue plan” is going to be Bush’s last shot for a plausible legacy. As the news reported tonight, the bill has gone through the House and Senate and is now on Bush’s desk to be signed into law. No matter how they word this bill, it is still a bailout. Call it rescue plan, intervention, paint it whatever color you wish, but it is still a bailout.

So where will this now lead us? Instant relief in the credit markets? Stability on Wall Street? How about stability on Main Street? Correct answer – none of the above. Don’t look for any short term fixes from this. Analysts are saying that direct results of this measure will probably not be seen until the end of 2009. So why the big hurry?

We cannot point a finger at any one person without pointing a finger at them all. I find it very hard to believe that no one in public office didn’t’ see this coming. Of course they did! It was their reluctance to do anything about it that made the mess we are in.

I have been reading a lot of different opinions on this bill all day. The phrase “doing something is better than doing nothing” kept popping up all day. AARP and the National Federation of Independent Business have been opposed to the bill. Lobbyists representing corporate executives, small-business owners, farmers and retirees swarmed over Capitol Hill yesterday to push for the bailout. Not to be outdone, the U.S. Chamber of Commerce began running full-page newspaper ads highlighting what it described as a massive threat to the economy if the package is not passed. Throughout all of this, I have heard no alternatives to what could be the biggest economic disaster in American history.

Alternatives for this could be many. Whatever they could be is uncertain – people are playing this very close to the vest, indeed. I read on The Arena, a site that debates with decision makers and politicos, these words from James P. Pinkerton, Fellow, New America Foundation: “It might, indeed, be the responsible thing to vote for a bailout, but it is irresponsible to allow such a meltdown to happen again. And it will happen again if banks, investment houses, and insurance companies are allowed to grow this big once again. Adding another layer of regulations and record-keeping will make work for more lawyers and more accountants, but if the basic business model survives-gambling with other people’s money, and lots of it-then we will right back into deep doodoo soon enough, except that the dollar totals will have a few more zeroes. Remember Sarbanes-Oxley? What good did that do?”

Regulation for regulation’s sake makes no sense. If it is needed, however, because banks and investment firms aren’t playing well with other people’s money, then indeed we do need regulation. If I make a blunder like the boys on Wall Street have done with this current crisis, I would now be reposing in a Federal prison. Yet we hear very little of this going on. Sure, we see a few token busts going on here and there. They aren’t, however, playing this stuff much on the evening news. Wall Street is blanketed by a lot of security and cover up that keeps them above the average “Joe Six-Pack”, to quote Sarah Palin. Is there a crisis? Certainly. Will this current bailout relieve the situation? Probably. Will it happen again? That, to me, is the 64 thousand dollar question. Cynical as I am, I have to think that it is only a matter of time until the lobbyists get to the boys on the Hill and once again it is business as usual.

Posted in Mortgage Refinancing, Mortgages
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One Response to ““Rescue Plan” Passes The House”

Rick Zepeda says:

October 4, 2008 at 10:06 am

It is important to note that borrowers who take advantage of this housing resuce plan must share their equity with the government, and they must pay 3% of the home mortgage loan value up front.

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“Rescue Plan” Passes The House

One Response to ““Rescue Plan” Passes The House”

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