I've got a better idea Peter.Let all the mortages that are going to collapse, collapse. I sure as heck would not buy them until they become cheap. That's capitalism!

Who gets to pick up the tab for all the lost money? It has to cost someone something, the someone is every responsible person. We already had to pay trillions to "save" huge corporations. Why should I have to pay for other peoples bad mortages.

If that is the case I should be able to buy a house valued at $200k for $100k right now. If I buy the house I should immediatly stop paying the mortage and then let it default. I would then be able to buy the asset at its true value which is 50% of the market price.

That is why all of these plans are screwed up. They are based on the value of an asset that has no value. A toxic debt has no value because it is worth less than the price you must pay for it.

That is like paying $30k for a Chevy Cobalt when the sticker is $15k. Why would anyone do that?

Sure the FDIC could take over all the foreclosed properties but there would be a few million properties that would be sold off for 50% of the pre-crash value. At that point why would anyone pay anthing close to pre-crash value for an asset. I would have to be out of my mind to pay $200k for a house when there are equal spec properties available for $100k from the FDIC.

See how your friends idea holds no merit. Instead the banks that held the toxic assets should have gone out of business. That was the only solution. Instead we kept them in business with a trillion dollar infusion of taspayer money. We screwed over the next two generations to keep thieves in positions of power.

The Walmart philosophy of "rolling back prices" is what should be administered to fix the economy.

We've basically robbed at least a decade of growth from the housing cycle just like the Japanese did as well. Historically, housing has an appreciable markup of 1-2% annually & America's greed escalated that to 20% or more in the metro areas.

Now the pricing has to "decompress" at a slow rate to allow absorption into the future growth cycle at a slower pace. The institutions responsible for bad lending practices should not be excused but allowed to clean them from their books "temporarily" handing them over to the gov't & buying them back systematically amortized over longer periods of time. This leaves the management of these toxic assets to the ones responsible on a longer term scale while being a constant reminder of their past sins.

Citi's good bank, bad bank is a classic illustration while being aided by the federal gov't but not allowed to completely walk away.

Reverse the cycle,, amortize the stupidity long term & let the culprits (including those in the private sector) pay it all back while recognizing smaller profits until this mess is cleared up.

This represents decelerated growth & takes the panic out of the entire cycle.....

The proposed solution is no different than the gov't buying every bank's securities at par. The only difference under your pan is the gov't doesn't have to come up with the cash up front. The major hurdle doesn't go away, i.e., how do you allocate the cost of the bailout between the banks.

By an unconditional guarantee of all underlying assets, every bank gets to be made whole, irrespective of the extent of their individual bad conduct, without any cost to the institution. The gov't won't do that, just as it won't buy everybody's junk at par. All TARP money till now has come in the form of perferred shares and and interest component; the issue with future TARP money is how is the institution going to pay for it. Your plan would ostensibly be free money to all banks.

Different solution, same problem.

HOW ABOUT WE GUARANTEE THESE BAD LOANS
IF EVERYONE WHO PROFITED FROM MAKING THESE BAD LOANS PAYS BACK THE MONEY THEY
MADE MAKING THESE BAD LOANS.THIS INCLUDES
THE SPECULATORS,REAL ESTATE AGENTS,THE REAL ESTATE BROKERS,THE MORTGAGE BROKERS,
THE LAWYERS AND THE TITLE COMPANIES.

Everyone's worried you're paying your neighbor's mortgage. Nope, even with this plan, you're limiting the Banks and Investors losses, the homeowners still lose. Properties will still flood the market and home values will decline. Only difference is, we lose, banks get insurance on their double down bet and investors get their money from us. It's a win win for banks and investors, and a lose, lose for the Taxpayers.

This is not the best idea! The best idea is for the government to force banks to sell mortgages that are behind payments and properties that are defaulted on and let the banks take the losses!! Maybe then they will stop paying 50 million salaries to all their top execs!! If not then Nationalize all the Banks and hire execs at $100,000 plus benefits ... Yes many would take these jobs and they at least would do as good as the idiots who got us into this mess with the 50 million salaries!!

Maybe all the banks that are failing shouldn't have been banks in the first place. I can't believe how many little no-name banks there are.

Get rid of the 20 million ILLEGALS and that will lower un-employment right now! Time to make our country free again ... First issue greenbacks like Andy Jackson did when he was President and get Rid of the FED and the BIG BANK control of this country which was a scheme by JP MORGAN and his son (see zeitgiest on the net)! Get rid of HEDGE FUNDS and FUTURES ON STOCKS !!Put tariffs on all imports which exceed exports so if they buy a billion from us they get a billion with no tariffs if more make 'em' pay!! Make all US based companies keep their customer service in the US ... do you want your financial data in India or Mexico(it is now!)! Go Electric cars now and promote use of solar ... wind ... wave and hydroelectric generators and start Geothermal plants (they power all of Iceland) this could end pollution and global warming while lowering OIL prices ! Get those Electric cars from TELSA Motors on the Road! We have the technology now! These are the real answers and easy to figure out!!!

The math is just flawed. First, the banks charged a closing fee of somewhere around 15K on a 200K loan. If the homeowner paid for 2 years on a 7% loan, which is what the going rate was on these risky loans, the banks got about 30K in interest. Now you're looking at about 45K the banks and investors have managed to get from the initial 200K loan which is actually 220K after closing and fees were rolled into the loan. So you take the 15K off the top, subract the 30K the banks made from the 50% that the foreclosed property nets and the actual loss is about 70K which would be about 210B on 3M Foreclosures. There is a second option. If the banks are willing to take the 50% hit, why not let the existing homeowner have a shot at it? Instead of the Gov't buying up the properties, let the banks work out a plan with the existing homeowner, no Gov. money and then if the house goe into foreclosure the banks eat the cost. At least with this option, it's still a transaction between the lender and lendee. No tax dollars needed. This should have been the process to begin with. By giving banks capital to absorb the foreclosures we set the taxpayers up to bear the brunt of the housing crisis when it should have been the folks who borrowed, and the folks who loaned. There is only one group who makes money either way on these loans, it's the lawyers, they get paid either way.

Is there anyone out there with a real solution ? Where are all the great minds
that make up this USofA ? The govt.
needs to reach out beyond their inner
circle to help find an answer....since it
doesn't seem to be within the walls of
the House or Senate.

It seems to me that these banks, especially Citibank failed for a reason, a GOOD reason and they should be the ones to pay for all the bad decisions that they've made to cause this crisis. A government bail-out of any company that has already proved it's inability to do business in a responsible and economically sound way should be erased. Saving any of them will only prolong the "agony" and make this financial nightmare last even longer than it alreay will. It's time to "clean house" and start over and all these big companies that have been raping America for all these years have to be made aware that they are the dinosaurs of our past and will be buried that way!!!!

Let me say first, how those toxic assts took place? and over the months are still increasing.
This toxic assets could have been avoided if the government could have declared a moratorium on foreclosures and freeze the mortagage payments at least for two years until, the new government will take office and the economy will get back on trac, this way, people wouldn't have lost their homes and businesses, and avoid all this mess, Bank could have been insured by the government to keep in business by pumping Money to the Fianacial Market like are doing now, but the wrong way.
Two years of moratorioum could have saved million of losses to the Banks and the american people.
Time is needed toreshape the american economy, but time with out pain.

We let these banks keep merging, getting bigger and bigger. Now we claim they are so large we can't let them fail! Hello? Much of the losses being reported are paper losses that the taxpayer is now being asked to make up for instead of correcting the Accounting procedures. Will the Senate see through this? I doubt it. They cannot figure out how to put brains in place to fix the problems instead of our cash.

FOCUS ON THE REAL PROBLEM(for those who haven't already seen or understood it).......THE REAL PROBLEM IS HOW MUCH MORE WE HAVE SPENT THAN WE EARNED........ WE HAVE REACHED A $6TRILLION TAB! ! !........HERE'S THE TRUTH, FOLKS...look at the $50-70 billion a month trade deficit, for the past ten years...That's $6 trillion, check my arithmetic.........What's interesting is that the new man at the helm is proposing we spend even more than we earn(An $820(?)billion rescue package?). Isn't that rather like having a drink or two to cure last night's hangover? We would still be alcoholics. The only logical answer(except one) is that we have to accept a lower standard of living...Not by much, but we cannot continue to spend more than we earn.....There is one other solution, produce and sell more, but is that likely? ?

Ok, but first, before a bank takes the guarantee they have to pay out bonuses to their execs the way Credit Suisse did - with the bad assets - and NOT with taxpayer dollars the way most of them did!

I think if we would give those people that signed on to bad mortgage products a chance to help themselves by alowing them to refinance thier outstanding balance at current rates regardless of thier current value as long as they still have a job and qualify we could see a dramatic reduction in forclosures without spending any tax dollars. someone needs to do the research. I am sure thier are alot of owners that would rather stay in thier home and ride this out if givin the chance.

The gist of it all was stated rather succiently on NPR - National Public Radio this morning.

As was stated, the economic meltdown was a result of prolonged excesses by various special interestsgroups . . the FIs - Financial Institutions, and coproate FRAUDS,corporations; groups such as the AMA, the pharmaceutical industry, the HMOs, etc.

The basic problem is that these special interests groups have financially bled the average Americans to a point that it collapsed our economic system . . . And these groups are still fighting for their financial "advantages".

During propserous times the average American is too apathetic to do anything;and the special interests groups are too strong politically . . . and the whole system sprials down. This economic melt down should provide the basis for correcting some, or many of these disparatives in our society IF the "average Americans" will pressure their Congressmen for responsible actions to correct these CORRUPTIONS and PERVERSIONS of our economy and society.

Congress WAS and IS the PRIMARY CULPRIT in enabling and allowing the FRAUDS and abusive practices in the past; and now Congress is the PRIMARY CULPRIT in NOT PROVIDINGeffective regulations, and oversight to INSTILL INTEGRITY in the financial reports and operations of the corporations and the markets/funds . . . and abuses by these other special interest groups.

If the Amercian people do not pressure Congress to act in diligent and responsible manners, then recovery will be very protracted and difficult. It is past time to purge Congress of the CORRUPT, INEPT, and/or INCOMPETENT Congressmen who are the primary problems in all of these matters.

have you contacted your Congressmen recently by email, FAX, telephone? If you haven't done that, then you aren't doing YOUR PART to get these problems addressed.

What is WRONG and SCREW-UP about all of these plans is that "those who benefitted financially from the FRAUDS of the past are "getting a free pass". Their "wealth", or excessive financial gains, were rooted in FRAUDLENT actions; and these people are being, in essence, allowed to keep their "ill gotten gains" . . . and the "innocent people" who acted prudently and responsibly are NOW being required to repair the economic damage for the FRAUDS that have been committed.

CEOs, Board Members, and upper management . . . and yes realtors and brokerage firm personnel, etc. . . . are all being allowed to keep the excessive profits that they received from these frauds.

Congress is too complicit in all of the frauds. Congress allowed and even enabled the BLATANT FRAUDS to occur. Barnie Frank is a blatant example of this type of "BLATANT CORRUPTION"; and now he is trying to be a "leader" for the recovery from the disaster that he significantly helped to create. This is ludicrious, isn't it?

The American people need to clean up the pervasive INCOMPETENCE and CORRUPTION in Congress.

"Evil exists and persists because "good men" do nothing".

As long as the American people tolerate the CORRUTION of the vast majority of Congressmen, nothing is going to improve very much.

"People have the government that they deserve . . ." . . . If people tolerate CORRUPTION and INCOMPETENCE, then they deserve that.

So, if YOU don't take actions to raise hell with your Congressmen, or support recall elections, then you deserve whatever befalls you in all of this.