Comments on: Unclog the Cash Pipe – Anyone Know a Good Plumber? http://themoderatevoice.com/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/ An Internet hub for moderates, centrists, and independents, with domestic and international news, analysis, original reporting, and popular features from the left, center, and right Mon, 23 Nov 2009 16:22:10 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: DLS http://themoderatevoice.com/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/comment-page-1/#comment-158072 DLS Fri, 10 Oct 2008 21:40:49 +0000 http://themoderatevoice.com/general/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/#comment-158072 We haven't seen the end of this slump, but only the start of a likely slump. The banks have a lot of bad mortgages (lenders and borrowers were greedy and chose not to be prudent), and derivatives based on them are also bad. But people have also been borrowing on credit cards to "buy" or "spend money" on things, and this has yet to end. If these credit card debts go bad, it's going to be much worse. The stock market is starting to go down, and if it stays down, this will affect the many companies who have invested in each other's stock, as well as the health of so many pension funds (has anyone thought about that?). Nobody knows yet how bad the shape of the banks really is, as well as if or when the mindset of people will change to inhibit spending or cash flow (which no "stimulus" measure can change). We haven't seen the end of this slump, but only the start of a likely slump. The banks have a lot of bad mortgages (lenders and borrowers were greedy and chose not to be prudent), and derivatives based on them are also bad. But people have also been borrowing on credit cards to “buy” or “spend money” on things, and this has yet to end. If these credit card debts go bad, it's going to be much worse. The stock market is starting to go down, and if it stays down, this will affect the many companies who have invested in each other's stock, as well as the health of so many pension funds (has anyone thought about that?). Nobody knows yet how bad the shape of the banks really is, as well as if or when the mindset of people will change to inhibit spending or cash flow (which no “stimulus” measure can change).

]]> By: mikkel http://themoderatevoice.com/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/comment-page-1/#comment-157697 mikkel Thu, 09 Oct 2008 16:42:11 +0000 http://themoderatevoice.com/general/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/#comment-157697 Uh but the whole reason why they started to fail was because the value was overinflated due to the declining values of the underlying assets and the fact that it wasn't a "free market" since all failures were bought back. The sellers started losing money on them (well and more importantly other stuff) and so there was no artificial prop for the market.<br><br>The ARS market dried up many many months ago so I'm not sure that necessarily is the catalyst for the current panic...and propping up the prices won't change anything but put the government on the hook for losses. If ARS was severely undervalued then groups that don't need short term liquidity would step in and make a fortune...the problem is that they <i>aren't</i> unless you think forward projections of asset values are incorrect. Uh but the whole reason why they started to fail was because the value was overinflated due to the declining values of the underlying assets and the fact that it wasn't a “free market” since all failures were bought back. The sellers started losing money on them (well and more importantly other stuff) and so there was no artificial prop for the market.

The ARS market dried up many many months ago so I'm not sure that necessarily is the catalyst for the current panic…and propping up the prices won't change anything but put the government on the hook for losses. If ARS was severely undervalued then groups that don't need short term liquidity would step in and make a fortune…the problem is that they aren't unless you think forward projections of asset values are incorrect.

]]> By: mikkel http://themoderatevoice.com/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/comment-page-1/#comment-157696 mikkel Thu, 09 Oct 2008 16:41:34 +0000 http://themoderatevoice.com/general/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/#comment-157696 Uh but the whole reason why they started to fail was because the value was overinflated due to the declining values of the underlying assets and the fact that it wasn't a "free market" since all failures were bought back. The sellers started losing money on them (well and more importantly other stuff) and so there was no artificial prop for the market.<br><br>The ARS market dried up many many months ago so I'm not sure that necessarily is the catalyst for the current panic...and propping up the prices won't change anything but put the government on the hook for losses. If ARS was severely undervalued then groups that don't need short term liquidity would step in and make a fortune...the problem is that they <i>aren't</i> unless you think forward projections of asset values are incorrect. Uh but the whole reason why they started to fail was because the value was overinflated due to the declining values of the underlying assets and the fact that it wasn't a “free market” since all failures were bought back. The sellers started losing money on them (well and more importantly other stuff) and so there was no artificial prop for the market.

The ARS market dried up many many months ago so I'm not sure that necessarily is the catalyst for the current panic…and propping up the prices won't change anything but put the government on the hook for losses. If ARS was severely undervalued then groups that don't need short term liquidity would step in and make a fortune…the problem is that they aren't unless you think forward projections of asset values are incorrect.

]]> By: Silhouette http://themoderatevoice.com/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/comment-page-1/#comment-157687 Silhouette Thu, 09 Oct 2008 16:24:44 +0000 http://themoderatevoice.com/general/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/#comment-157687 The plumber is time. Just wait. A few weeks could change the whole thing for the better... ; ) The plumber is time. Just wait. A few weeks could change the whole thing for the better… ; )

]]> By: africanqueen http://themoderatevoice.com/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/comment-page-1/#comment-157680 africanqueen Thu, 09 Oct 2008 16:03:13 +0000 http://themoderatevoice.com/general/23327/unclog-the-cash-pipe-anyone-know-a-good-plumber/#comment-157680 Thanks for making this understandable in laymans language. Someone seems to be making this process very difficult to wade through and even monumental to solve. The world is watching, other countries are helping out, we all wait wide eyed like a deer in the headlights to see if the bleeding stops and the patient recovers. McCains idea expressed in the last debate (taken from Hillary CLinton) and currently in the "bailout" as it is written , will be discussed but seems to only exacerbate the problem Sounds good to the voters at first glance but not with critical analysis. Thanks for making this understandable in laymans language. Someone seems to be making this process very difficult to wade through and even monumental to solve. The world is watching, other countries are helping out, we all wait wide eyed like a deer in the headlights to see if the bleeding stops and the patient recovers. McCains idea expressed in the last debate (taken from Hillary CLinton) and currently in the “bailout” as it is written , will be discussed but seems to only exacerbate the problem Sounds good to the voters at first glance but not with critical analysis.

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