BOOM!!!! Financial Meltdown!

[capcom_suicide]

Looks like the House of Representatives just voted AGAINST the $700bn bail-out plan... stock markets going mental.

Who knows what happens next....

I would guess shares fall about 15% whilst the democrats convince their own ranks who voted against it, to vote for it.

Then the markets will rally and things will return to normality over the next 3 years, with credit being used much more carefully, from buying a TV too buying a trillion dollar debt.

Alternativly, there will be a complete dry up in liquidity and governments will be forced to act, whilst a lot of people lose their homes and jobs.

Welcome to the biggest ecomonic depression of the modern age. If you're rich, you gonna big richer. If you're poor, your in for one hell of a ride.

[mmcg]

I would guess shares fall about 15% whilst the democrats convince their own ranks who voted against it, to vote for it.

Then the markets will rally and things will return to normality over the next 3 years, with credit being used much more carefully, from buying a TV too buying a trillion dollar debt.

Alternativly, there will be a complete dry up in liquidity and governments will be forced to act, whilst a lot of people lose their homes and jobs.

Welcome to the biggest ecomonic depression of the modern age. If you're rich, you gonna big richer. If you're poor, your in for one hell of a ride.

What if you're neither rich nor poor?

[Rossco]

Carry on regardless.

[dataDave]

Keeping hold of jobs should be everyone's concern right now I think.

Just carry on as Rossco says, FA else to do really.

[MattyD]

The thing that sickens me about all these banks getting nationalised, bailed out with huge loans from central banks etc is that they knew the risks they were taking when the played the game. If I went and blew my month's wages down at the horses and came back here pleading for people to take on my bills or repay me my losses so I could continue to live, I'd get told to piss off! And what's more, these people are playing with money that isn't even theirs!

It makes it all clear when you see figures in the press about how banks like the late Lehman Brothers went bust owing just over $6 billion... But paid out over $8 billion in staff bonuses last financial year. Greed is what it all boils down to.

[vanpeebles]

The thing that sickens me about all these banks getting nationalised, bailed out with huge loans from central banks etc is that they knew the risks they were taking when the played the game. If I went and blew my month's wages down at the horses and came back here pleading for people to take on my bills or repay me my losses so I could continue to live, I'd get told to piss off! And what's more, these people are playing with money that isn't even theirs!

It makes it all clear when you see figures in the press about how banks like the late Lehman Brothers went bust owing just over $6 billion... But paid out over $8 billion in staff bonuses last financial year. Greed is what it all boils down to.

Exactly, fair play to the those who voted against the bail out. The hard working modest should not bail out the fat cats and taxes should be better spent on public services.

[ItsThere]

Exactly, fair play to the those who voted against the bail out. The hard working modest should not bail out the fat cats and taxes should be better spent on public services.

Sorry to disagree but in the long term public services will suffer (increased cost of credit and contracting for one) if the market is not given the confidence to recover.

It may leave a bad taste in the mouth but unless cash is stumped up now to prop up the way our financial systems have developed it will get a lot worse.

This may well turn out ok if a new Bill can be re-negotiated quickly but I mean like one day quick.

[vanpeebles]

Well maybe the current system of ringing out every last pound and dollar to reward shareholders isn't working.

[capcom_suicide]

Exactly, fair play to the those who voted against the bail out. The hard working modest should not bail out the fat cats and taxes should be better spent on public services.

Then who will bail us out when the interest rates go to 15% and we can't sell our house that are in Negative Equity.

Plenty of sensible people have taken house loans (No Credit card debt or Car loans) based on a good safety margin.

A financial crash means a whole lot of normal people will be caused to lose their homes.

It's horrible to think we have to "Bail out the banks" but faced with that option instead of my family being homeless, then I feel we have no choice.

We need a band aid to get through this mess, and then Governments must tighten up the system and prevent a similar event occuring.

If the banks run out of money, it's bad for everyone who has a significant morgage.

People who have been crazy with getting huge morgages above a sensible level and have loads of credit card debt... Well on the one hand "They gave you the credit" but on the other hand you knew that the day would come when you would need to pay it back....

Strange times...

[ItsThere]

Well maybe the current system of ringing out every last pound and dollar to reward shareholders isn't working.

Agreed. But its difficult to control greed...

[vanpeebles]

I can see them getting bailed out, the tax payer takes the massive brunt of it and they get back to their greedy ways in a few years.

[ExtremePabs]

Anyone who has bought a house in the last two years (I am thinking mainly first time buyers or buyers who propped up their other debts with a mortgage) must have realised that they were paying 20-30% over the odds for their house. The bubble was always going to burst at some stage it was not sustainable, win some lose some its an expensive gamble.

BTW - I say let the chips fall where they may it about time people learnt some harsh lessons

[abigsmurf]

Nash would have a field day with the thinking behind the payout. People are thinking selfishly and the entire system risks collapsing because of it.

The thinking "not my fault, not my problem" falls down when you discover your pension was invested in a failing bank or your place of work has to close because it can't get financing. Heck even if that doesn't affect you, having thousands of people suddenly on the job market drives wages down (at a time of high inflation) and makes it difficult to get jobs.

It wasn't just the banks at fault. People took out mortgages they couldn't afford. The banks shouldn't have issued them but the people shouldn't have applied for something beyond their means. To shift all the blame 100% on the banks is to stick your fingers in your ears going 'nyah nyah I can't hear you'. Of course, the politicians won't say this because you don't bad mouth potential voters.

The bail out had to happen. They're not giving away $700billlion, they're loaning it. It's just secured on uncertain debts. There's a lot of *** being spread that the $700billion is just being given.

But hey "why should I have to pay any of my money to stop a recession?"

[vanpeebles]

Thing is a whole number of problems all to do with the banks and financial systems. Not your working man in the street.

The whole mortgage system changed in the US and a lot of people including our banks tried to make money from that. The economy should of been wound down properly but instead everyone started to offer loans and lots of credit to keep people spending. Not to mention the over valuation of companies and stocks plus the rampant must deliver max profits to shareholders at all costs.

You can't privatise profits and then socialise the debts.

[fishbowlhead]

You can't privatise profits and then socialise the debts.

However thats exactly whats happened, and when everything goes back to normal in a few years the fat cats will be even fatter for it, and things will be even harder for all of us scratching livings.

The rich get richer and the poor get poorer, this has always been the way of the world.