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I bow down humbly in the presence of such gratneess.
Amen Brian. The forrest has to burn to rejuvenate new life. It's
the way nature planned it. Our economic system needs the same
cleansing. Painfully sad, but true. Let the market place replinish itself.
Adam,
I don't think the sound is working.
Peter,
Make sure your speakers are turned on. The sound is working fine on this end. So far you are the only one who has had a problem with it.
Best of luck,
Adam
I have been out of the market several years, since quadrupling my money in 15 months 2002-2003. Following back surgery in Septembet '08, I was not allowed to BEnd, Lift, or Twist (no BLT), so I spent 12-15 hours per day on my computer studying the stock market. I had never heard of ETFs and had not traded options for 30 years. I bought the big banks long, rode them up & sold, then rode them up again and sold just before TARP-1, taking a 30% profit.
I have read the views of many "Free Marketers" that we should have let the big banks fail, along with AIG, instead of 'Giving' them a 'Bailout.' They never explain what they would do to prevent the dommino effect that would have destroyed institutions world-wide--just let them fail, also?
They never seem to understand that our govt. borrowed money at about 1% and invested it in the big banks & AIG at 9%. I would take that kind of spread all day, if I knew I had enough borrowing power to save the institutions. What is .08 X 350 Billion? $28 Billion per year! That is enough to fund a lot of the stimulus package.
I read their harrang that 'the govt. is printing money, running us into INFLATION!' It is not creating money to borrow & invest.
Switching from preferred stock to common shares allows the government to enjoy the rise in price of Citi Group as it rises to a prie of$ $15-20 when that company comes out of the present crisis.
Somebody tell me why my thinking is wrong?
William,
CAUTION: Free market rant enclosed--
If I could be the devil's advocate for a minute, where do you get the notion that the gov't will get a 9% return on its "investment"? I don't know where you get that figure, but it sounds unrealistically optimistic to me. You mentioned common stock appreciation, but that's certainly no slam dunk. Maybe you were referring to dividends, but there again I fail to see how they could maintain a 9% dividend rate when they are essentially broke.
Who are they going to loan money to? The same deadbeats that already owe them billions? As job losses mount, there will be fewer and fewer qualified borrowers. I don't think they want to flush more $ down the toilet by loaning to UNqualified borrowers like they did the past few years, which is part of what got us into this mess in the first place. We need to reduce debt, not add more as the politicians would have us believe. They are notorious for telling us to spend, spend, spend, when we should be saving money.
By propping up zombie banks, all they are doing is standing in the way of the free market forces that are needed to weed out the weak players. If only the stronger banks survived, they would quickly expand their operations to take on any profitable business after conditions improve that would have gone to the zombies. Propping up zombies only prolongs the final day of reckoning and will allow weaker players that would have been dissolved in a free market system to remain, and perpetuate their bad business practices.
A healthy economic system needs recessions to cleanse the system of mal-investment. But politicians think they have to artificially meddle with the money supply, and not allow a recession to run it's course. That's how asset bubbles are created. Now the chickens have come home to roost and we have a depression this time around. Of course now they are futilly meddling again, trying to 'save the world', but they will only make things worse once again. Then you and I and our children will wind up paying through higher taxes and future inflation.
Let's face it, no matter what anyone does, someone is going to have to take a big loss somewhere, and it's going to be painful. Why make the taxpayers shoulder the burden of bankers who gambled big and lost? Let the ones who were more sensible and didn't make risky loans and swaps survive, and get the pain over with now. I don't buy the argument that letting these banks fail would ruin the world.
Daniel,
Not sure I understand your statement. Can you please clarify what difficulties are you having?
Thanks
Adam
you make this too difficiult to operate!!!