I honestly don't understand.

[angledge]

Why is it so urgent that Congress pass a bailout bill in the next few days? I understand that they are supposed to adjourn at the end of September, but surely they could stay a few extra days, if needed?

I feel that there is a false sense of urgency to pass this gigantic bill without giving it the examination & debate it needs.

Comments

[kielbasa-007.livejournal.com]

well....
Here is the deal on an ultra simple level, banks rely on credit to lend out; there are rules about how much cash you need to how many dollars you can lend out. I think that your local bank gets a 1:10 ratio, the investment banks have more 1:20. So every $1 in their valut they get to lend out $10. Now since loans are failing the amount of cash at hand is dwindeling. Dwindeling cash equals less outgo, less outgo means they need to call in loans (hey bob, we need that money back-- Now). Domino by 10,000 foreclosures PER DAY and you got a crisis brewing

[angledge.livejournal.com]

I understand the crisis at a basic level. But what I don't understand is why passing a bill tomorrow is going to be so much better than passing a bill in a week, after there's been some time for people to actually think about what we're spending nearly $1 trillion on.

[kielbasa-007.livejournal.com]

literally because there is not enough time left.
Washington Mutual went bankrupt last night and was boughtout almost immediately through Federal brokering. Every day delay you cold possibly see more banks go under.

[angledge.livejournal.com]

And now Wachovia has gone under. I still say, so what? Something like 80% of their deposits are FDIC-insured, & the banks that bought WaMu (JP Morgan Chase) & Wachovia (Citibank) have guaranteed ALL deposits.

If the banks vetted mortgages poorly, they should fail. We will end up with some mega-banks, which will then pull Stupid Bank Tricks like cutting interest rates & raising fees. This will create an opportunity for smaller regional banks to gain customers by eschewing Stupid Bank Tricks. And so the market goes.

[(Anonymous)]

You are talking about the individuals. Let me put forth the case of the local business that had a line of credit with Wachovia in order to buy materials......now that is gone, so they can't buy goods on credit.