I think most investment advisers would tell you that the intrinsic value of these assets exceeds their current market value. That begs the question as to why folks in the market aren't buying them, of course. That's a more complicated issue related to the lack of liquidity, no institutional buyers (who wants to say they made a bet on subprime assets at this point), leaving you with vulture buyers (hedge funds, for instance) and huge bid-ask spreads.

when they sell the assets back to the market, once the markets unfreeze and get liquified and confident, they will be worth more than they buy them for today. this actually could take a HUGE bite out of our debt.

A good day to be a libertarian and one that has never put much faith into the financial investment markets. A libertarian commentary posted on cnn.com

That's kind of funny, in a sad way.

99% of the effort of this bill (and probably every bill) is political.

1% of the effort, of an already inept group, is being put towards the actual merits of this ridiculously overreaching bailout. So why does almost everyone here have so much confidence in it?

There's something odd about Pelosi blabbing about "the spirit of bipartisanship" when she's criticizing an entire party for not voting exactly per the plan. There's nothing bipartisan about a scheme like this. What's the gain in having a majority of the House when you're too wrapped up in politics to take advantage of it?

This display, more than anything else, damns both sides, and shows more than anything else that GOVERNMENT IS BAD. They cannot save the economy, they absolutely WILL make it worse if given the chance. Bucc's right, it's a good day to be a libertarian.

That, in a nutshell, is what I have found so sad about today. More people concerned about the politics of this vote than the actual contents of the bill.

And yet you have zero problem supporting WHATEVER they came up with in the few seconds they had to spare between the vote swapping.

You're assuming that a worthwhile percentage of these assets are viable.

You're assuming that management of the viable assets will be done properly, if the government has influence in said management.

I have doubts in the former, and complete doubt in the latter.

If this goes through, and my doubts are correct, we're 1000 times more fucked than we are right now.

the bill couldnt change.

you're right that we are on the opposite side in our assumptions.

I'm sure there's PLENTY of quotes/clips of Republicans saying the same kind of stuff, but I wonder if it's as entertainingly feisty as these:

Government oversight + an appointed board/commitee/whatever. They'll get their say.

And government appointees are rarely given their gigs based on merit, especially if we're talking money in the trillions. They'll play ball.

What is the Judges and Stewards Commissioner for the International Arabian Horse Association, (IAHA), doing these days?

I digress.

Of course it could. Not today, under this vote, but it's not this today or nothing forever.

I tend to avoid most of the political threads on here like the plague, so I'm not up to full speed on everyone's overall views on various subjects. That said...

I'm extremely curious as to why you have so much faith in our government, especially in regards to money management.

I very seriously doubt this. This may not be a guarantee "fix," but I doubt it will kill us either.

If taxpayers are on the hook for some 700 billion and mismanagement/screwups/overestimations of assets/corruption put us right back where we are now in a couple years, I don't see how we're NOT fucked.

Well, in this case because theyre hiring experts to run it from outside the gov't. so consider them civilian contractors. I have faith they'll do better than actual Gov't employees.

Actually, the treasury plan included hiring a number of outside investment managers to run the fund.

Exactly - our government leaders are pretty much useless. The guy from Texas who appeared on CNBC just kept saying that the Dems could have passed it if they wanted to because they have the majority - his mission isn't to save the country from economic disaster - its to make sure we blame the Dems and the same holds true on the other side. Nobody cares about fixing the problems - they just want us to know that the other guy isn't fixing it. This is why elections now for office are "pick the guy you hate less that you think won't screw things up more than the other inept guy".

I'll say this again - SOMETHING needs to happen. If nothing is done today's almost 800 point drop won't be anywhere near the end. I can't even believe that the market fell almost 800 points in one session - like someone mentioned - this is no correction. You don't lose 800 points in one session in a "correction". Raise the FDIC guarantees, change the mark to market, reinstate the uptick rule on short selling - these things can be done immediately without waiting for our inept congressmen and women to continue their grandstanding to get reelected in a couple of weeks.

Right, which I understand.

However, I am rather of the opinion they'll be hiring outside help who know exactly which people to help a little more than others. The opportunities for greasing palms here has got to be on epic scale, and the politicians are salivating to have these folks in their back pocket.

I realize you're not Mr. Potter here but I'm just pointing out that this problem requires intervention immediately. I personally do not want to see the fallout of letting the chips fall where they may on this one. I'm not in favor of bailing out any company but I'm less in favor of letting our economic system collapse in the immediate future. You're definitely right - this problem should have been handled long before now and I have little confidence that the people in Washington are capable of getting anything right let alone doing it in a weekend but time has run out. The market needs stabilty now before its destroyed further.

Cramer (and I'm no fanboy of his) wrote a piece a few days ago about the worst case scenario being the dow at 8400 and I thought how could we possibly lose 25% of the value of the market. Seeing a quarter of that drop happen in one day even with the possibilty of the bailout eventually happening is downright frightening.

winner

and crazy as it sounds, Kramer's been right and the harbinger of bad things to come has been Oppenheimer's Meredith Whitney who has been looked at as crazy until she started beomcing the allstar for her predictions of dire dire circumstances.

Hey, we agree on something. :)

The bailout should focus on fixing the root cause of the problems (which is different than not doing anything). Fix those and you are assured of a better future; otherwise, we are still facing downhill.

I'm just afraid the stock market will REALLY take a beating after the 2nd or 3rd massive bailout, when the sentiment seems to be "let's trust our lawmakers to figure it out in the meantime", at the same time everyone agrees that they're useless.

that needs to be in addition to, but the ball keeps getting further and further away from us.

Really? So now you're in favor of doing things short of a bailout?

Asian markets are getting destroyed.

There is nothing else on the table and something needs to be done yesterday....so the 'bailout' as youre calling it, needs to happen. Now.

BTW, youre not going to be convinced otherwise, so be it. Im backed up by the facts on the field, market action, number of foreclosures, Statements by experts (Buffet, etc), bankruptcies of huge banks, credit swaps, rates, etc. So stand over there and watch the blood.

If this country faces a major crisis, does the fact that it's a holiday matter? I'm not saying you have to vote on the other bills and such, but this is such a lame excuse.

You're absolutely right - and to do that takes time and thought. Time is up. We need stability immediately to buy the time to figure out how to fix it.

yup

If they were to bailout the system now and not fix the problems then yes - subsequent bailouts will mean further destruction of wealth and massive beat downs of the market. But I'm telling you that there is the potential to lose so much right here, right now that something has to happen to stop it. There's more options than the bailout but nobody is willing to do anything apparently. What happened to the days when down 100 was cause for a little worry? Now we're down close to 800 in a day and we're still not concerned enough to do anything about it?

So you acknowledge that the bailout merely delays the inevitable unless further change is made? What should the further change be? Do you trust Congress to do it?

Actually, here are a couple hundred economists who disagree with Paulson's plan.

http://faculty.chicagogsb.edu/john.c...ge_protest.htm

Of course, that was according to how the bill stood a few days ago, but as far as I can tell, nothing much has changed about the bill since then. All they did this weekend was argue politics.

if you mean 'inevitable' to mean additional fixes to the system, than yes. I'll leave add'l moves to the experts to come up with ideas, theyre smarter than me, hence my trust in Paulson and Bernanke on the need for this bill....now. I trust Congress to get this through, yes. I think it'll happen on Friday but hopefully it wont be too late for a bunch of the regional banks and hopefully we dont lose another big house.

and VPI I can find tons who do subscribe to the need for the bill to gain us some time. Your point is taken that there are always people on both sides and we can find facts to defend ours til we keel over...unfortunately my facts are going to bear fruit very very soon.

Nikkei already down 477pts (4%)

This is no longer a valid question - I don't think anyone trusts Congress to have been able to wrap their heads around this problem in a weekend when they've had over a year with it staring them in the face. We're out of time and the only people who can stop this bleeding, like it or not, is the SEC and Congress. Believe me, I could come up with a LONG, LONG list of people I would like to see fixing the problem before I got to either Congress or Christopher Cox but time's up and they're the ones who have the power to do something now.

The difference is that you're talking about politicians and I'm talking about actual experts in the economy.

In '87, the market went down 22% and the world didn't end. Just because it's down 7% now doesn't mean we should throw $700b into the biggest money pit this country has ever seen.

I'm curious. To those that are strongly advocating immediate actions, are you heavily vested in financial markets for personal net worth? I am trying to understand the difference in attitudes of those that are vs. not.

Gary, what line of work are you in?

We need surgery, not a band-aid.

I think a bailout is a huge mistake. But I work in a recession proof industry and do not have much invested in my 401(k) yet.

There's going to be a deal though, there's no question about that. I'm not particularly concerned about the stock market long-term, because it's been ridiculously overvalued for a while, and still will be after this mess. It, like the housing market WILL come down to earth, hard, there's absolutely nothing Congress can do about that. The point of the bill, as I understand it, is to ensure that credit will be available. That object isn't hindered by another week or two. Credit is available today, and it will be next week. The stock market is fickle. If the media didn't hype up today as THE DAY everything had to happen, the losses wouldn't have been as great. Once there's a deal, the stock market will quickly recover (and then it will continue it's inevitable decline once again).

But if you're right, we'll all know soon, because there will be a deal this week. You'll probably try to prove how correct you are by the stock market's increase that day, but nothing will be fixed, that money will be burned through in no time, and then we'll back here in no time (except that we'll have way more debt.).

molson, some housing markets have and will fall hard, some are still doing ok. I also think "fickle" is an understatement. With the markets (financial, oil, etc.) becoming the domain of short-term speculative interests, it takes almost nothing to have major swings that up to a few years ago were unthinkable.

Funny you should ask...I make computer games :) Well that and I do some accounting/financial analysis - but just until my games make it big ;)

I'm not a financial manager nor do I even play one on TV. I'm not heavily invested in the market (although if I did have piles of extra money I would be and I wouldn't be working two jobs) - I've always just liked the market alot and followed it and bought a few shares of stock here and there (plus having a 401k). And above all I pray that I'm very, very, very wrong about what I think could happen. I'm concerned about the greater global economical impact of what might happen as opposed to whether or not my couple shares of stock in a company get wiped out (not that I would be crazy about that either)

Why do you ask?

You need to stabilize the patient before you do invasive surgery.

Jeffery Miron, the libertarian Harvard economist of the commentary I posted above, is on the list.

hmmm, I'd say the people that are experts giving congress advice are, well, experts.

Bucc, I am not heavily invested but have a 401K and some stocks. I sell homes so I am on the front lines and see the people everyday that are being touched on 'main street'. Good question though.

trust me when I say I want to be proven wrong and credit as you know it may be available but the credit Im talking about is NOT available today, and wont be tomorrow or the next day unless we do something fast. Either way Im with gary and hope Im way wrong.