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No More bailouts, Let irresponsible buisnesses fail

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Forum topic by patcollins posted 05-20-2012 03:26 AM 981 views 0 times favorited 13 replies Add to Favorites Watch
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patcollins

997 posts in 1521 days


05-20-2012 03:26 AM

The Obama administrations has a great opportunity here with JP Morgan, if their losses from the hedged bets will cause them to fail without intervention then let them fail. Adding more regulations but then bailing them out is playing the parent that always bails out the troubled teen, they loose any consequences to their actions.


13 replies so far

View RussellAP's profile

RussellAP

2950 posts in 942 days


#1 posted 05-20-2012 04:14 AM

I think they need consequences and prosecution.

-- A positive attitude will take you much further than positive thinking ever will.

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tomd

1758 posts in 2426 days


#2 posted 05-20-2012 05:03 AM

A loss of 2 to 4 billion will not fail JP, they move more than 250 billion. Although a large loss it is more of an embrassment to their investment policies and a wakeup call to their investors.

-- Tom D

View BobM001's profile

BobM001

388 posts in 986 days


#3 posted 05-20-2012 03:01 PM

Why did this happen? Here’s the WHOLE reason and the PLAYERS that killed the Glass-Steagall Act>in 1999 that would have prevented the 2008 meltdown AND this latest JP Morgan fiasco.

-- OK, who's the wise guy that shrunk the plywood?

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patcollins

997 posts in 1521 days


#4 posted 05-20-2012 04:00 PM

I have no problem with the Glass-Steagall act being repealed, if enough banks find out that they can loose money and not get a bailout from big brother they would either take care of themselves properly or die.

As far as prosecution goes, its hard to prosecute something when no obvious crime has been committed.

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patron

13034 posts in 1997 days


#5 posted 05-20-2012 04:30 PM

There are a lot of folks who can’t understand how we came to have an oil shortage here in America.

Well, there’s a very simple answer.

Nobody bothered to check the oil.

We just didn’t know we were getting low.

The reason for that is purely geographical.

All our oil is in Alaska, Texas, California, and Oklahoma.

All our dipsticks are in Washington, DC.

-- david - only thru kindness can this world be whole . If we don't succeed we run the risk of failure. Dan Quayle

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patron

13034 posts in 1997 days


#6 posted 05-20-2012 05:30 PM

Official Announcement:
The government today announced that it is changing its emblem from an Eagle to a CONDOM because it more accurately reflects the government’s political stance.

A condom allows for inflation, halts production, destroys the next generation, protects a bunch of pricks, and gives you a sense of security while you’re actually being screwed.

Damn, it just doesn’t get more accurate than that.”

-- david - only thru kindness can this world be whole . If we don't succeed we run the risk of failure. Dan Quayle

View jeepturner's profile

jeepturner

920 posts in 1448 days


#7 posted 05-20-2012 06:42 PM

“I have no problem with the Glass-Steagall act being repealed” patcollins

“Those who cannot remember the past are condemned to repeat it” George Santayana

Banking crisis were a ~10 year cycle in the free market of the US prior to Glass-Steagall, and the interesting thing to a history buff like me is that it took about 10 years for the banks to start another one after it was repealed.
I have learned not to discuss economics here but, I just had to interject because there is a long history before G-S. It was not created in a vacuum, there was a reason for it, but we forgot.

-- Mel,

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Sawkerf

1730 posts in 1724 days


#8 posted 05-20-2012 10:35 PM

I’m thinking that organizations that “are too big to fail” should be looked at as monopolies (or near monopolies) and either divest themselves of some of their holdings or show how they would survive a financial crisis without running to the government for a bailout.

Going forward, future mergers and aquisitions should be examined for their potential for needing a bailout. If the new entity would be “too big to fail”, it wouldn’t be allowed to exist.

-- Adversity doesn't build character...................it reveals it.

View Rick M.'s profile

Rick M.

3975 posts in 1036 days


#9 posted 05-21-2012 10:48 PM

Bank bailouts predate the birth of our country, it is nothing new and unfortunately is not likely to end soon.

-- |Statistics show that 100% of people bitten by a snake were close to it.|

View Nomad62's profile

Nomad62

710 posts in 1614 days


#10 posted 05-22-2012 04:42 PM

I agree Pat, the problem is that JP Morgan will pay nothing, it is just a name. The people in control will take all the money they want, leaving the entire loss to the investors that made the mistake of believing JP’s empty promises. Rich people make the rules, the poor people end up paying. Kind of like the “super committee” (Isn’t that the stupidest name?) that our government put together to come up with a way to cut government spending; they came up with nothing (except their paychecks), so our government is deciding to take it from welfare and senior services. Yep, don’t take from the rich, take from those that don’t have money in the first place…who cares if they die? Patron, absolutely loved your posts! I can’t wait to see the gas companies crying how they need a bailout. Maybe they’ll get it from all the people that lost their homes to foreclosure after gas tripled in price…oh, wait, that was the banks.

-- Power tools put us ahead of the monkeys

View waho6o9's profile

waho6o9

4926 posts in 1233 days


#11 posted 05-22-2012 04:44 PM

Get the private sector out of the public sector.

The loss from JPMorgan must mean some one else gained a couple of billion. That’s great news for
those of us who like velocity.

View helluvawreck's profile

helluvawreck

15798 posts in 1522 days


#12 posted 05-22-2012 05:00 PM

A good one, David.

helluvawreck
https://woodworkingexpo.wordpress.com

-- If a man does not keep pace with his companions, perhaps it is because he hears a different drummer. Let him step to the music which he hears, however measured or far away. Henry David Thoreau

View bunkie's profile

bunkie

411 posts in 1803 days


#13 posted 05-22-2012 07:59 PM

The real tragedy of the repeal of Glass-Steagall is that it diverts deposit money from the function of making loans into market plays. This means that capital formation (by collecting deposits) is used for speculation rather than loans to businesses and individuals. Because of low interest rates (because we’re scared of inflation), banks are much more likely to do this sort of prop trading for short-term profits. Glass-Steagall separated the functions of banking and brokerage, now the money in your savings account can be used to buy derivatives and short stocks rather than as loans to your employer or customer. The lost opportunity cost to the economy is enormous and it explains why we have huge pools of capital out there not being physically productive.

Look, banks exist to make money. We can’t blame them for that. But we do expect banks to perform essential functions that make other things possible. Pursuing policies and that promote the flow of money in the physical economy is just good practice. This, in my opinion, is the real issue.

-- Altruism is, ultimately, self-serving

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