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  •  The benefit to the little people from the bailout (0+ / 0-)

    is the protection of their life savings held in money market accts. Failure of the moneymarket would have taken us into a depression right now, so I'm glad Bushco decided to DO SOMETHING!!! This bailout followed one of the big moneymarket funds revaluing each dollar's worth of people's holdings to 98 cents (or near) on Wed I think, following the Lehman fold, and freezing withdrawals for a week. Definitely time to panic.

    What I really don't like about the bailout proposal (assuming I even understand it) is that we the taxpayers are going to buy up all the bad mortgages at their over-inflated bubble selling prices, rather than either what the properties are worth now (less, since prices are down), or what they'll be worth if they ever sell (even less, since the ARM mess won't really be over for another couple of years).

    And yet more of the brainiac plan: we are going to hold on to these properties until their values appreciate! and the taxpayers will make a profit! Hah, that can only happen if we don't stay in recession or don't enter a period of stagflation. Because those properties are priced too high, that's one of the reasons they can't be sold (it is not only the lack of credit lately, it is that the houses remain overpriced with respect to local wages).

    And another point, those foreclosed properties are losing value simply by being vacant and unprotected. When vacated they may be worth eg $200K on a defaulted value of $300K, but once they are vacant they get raided ... appliances and fixtures and even copper wiring and floor coverings stolen. The buildings themselves retain just the value of their shell plus land ... certainly not $200K anymore. So is Uncle going to rent them out to their former owners in lieu of leaving them vacant? Who will pay the fix-up costs? What will the rents bring in? Where's a sensible plan?

    Seems to me that with this bailout, the taxpayer and not the shady bankers take the hit from the bubble bust, plus the price of housing will be held at its artificially high bubble value by our own government, that is, US, under tightened credit conditions. So fewer of us will be able to afford to buy them.

    Finally, the shady bankers have already rebounded from their "rough week" and were already back to speculating as usual on Friday. They are probably knocking back martinis right now planning their next sidestep of regulations, because for them the new rules are clear: all profit, no risk. Oh, and the bailout is right on schedule so the GOOPers can sing "Happy Days are Here Again" on their drive to the polls.

    Hopefully, I am all wrong, and would appreciate any corrective comments.

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