Bailout Views
Me: "What do you think about the bailout bill?"
Dad: "I don't think that I, my children, or my grandchild, if there's every going to be any (me rolling my eyes at that moment) should have to pay for this mess. Did you hear about the 17 day man?"
Me: "No."
Dad: "The man was hired by one of the companies that is going under. He worked there for 17 days. Because he was hired and then let go, he was given a 30 MILLION DOLLARS severance! I don't think that the every day Joe should pay for this. And it's not about the mortgages, though that has something to do with the sway of things. Some places are feeling the mortgage problems with a decrease in the value of homes, but that was coming no matter what."
Me: "If it's not about the mortgages, then what is it about?"
Dad: "Remember how they tried to tamper with the social security funds not long ago? They couldn't touch it. It boils down to there are some people in this world that want control over this country's income. There's a lot of income out there in the 401k and they, those people, are playing with it. But these people also have a problem. The people who want the wealth of the country want to play the stocks, but all these every day Joe's like you and me who have 401k monies into the stock. Well, our 401k monies - that messes with these big time stock brokers. The some people can't figure out the stock, because us little guys move things around constantly. If those people put fear in us to get out, it leaves the bigger chunk of change to them and then they can control the game again. I got my money out of the 401k plan last year when it started."
Me: "Why didn't you tell me that? I still have monies in 401k!"
Dad: "Because I plan on retiring in 10 years. If you don't have to retire in 10 years, stick with it, roll the dice and you could make a killing."
Me: "So, you don't think the government should bail out these companies? I heard that WaMu is being taken in by Chase."
Dad: "Yeah, that's a big company too. International. We're talking, AIG, along with American General. And let me tell you, Chase is going to make big bucks. They are going to buy the portfolio at 33 cents on the dollar or something along that lines. And what? The mortgages aren't going to move. Chase will still own the property. The credit card accounts they can't collect will be sold to an agency for collection purposes. Companies like Chase who are more stable will come out of this great."
Me: "What about the every day people? What will happen to us? You were around for the depression years ago, what was it like, what do we expect?"
Dad: "Our company shouldn't be affected. We aren't borrowing money for our company. We're paying the bank back. And we can be there for the customers who can't get car loans and personal loans, because the banks are going to tighten up."
Dad continued: "Not much will happen to the every day living that you have if the government doesn't bail out those companies. What an individual will need to look at is his or her credit card limits. Instead of having a credit card limit of 10k, if the current balance is 5k, the credit card company will max it at 5,500. That's what you have to look out for. It will affect people who are used to living off of their credit card; those who are robbing peter to pay paul."
Sounds like to me, that this situation will force us to be credit conscious again. People won’t be able to get credit card offers left and right like you do in the mail every day.
Something smells that a politician is willingto bail out companies. Look, our small company, if we didn't make the payments to the bank, or if I *personally* didn't make payments to my mortgage company - is the government going to come bail me out?
I don't like government playing the stock market and I don't like the stockbrokers messing with my 401k.
Reading on another blog, the person wrote regarding the Senate:
"Watch as we selfishly mortgage our country's future so your portfolios stay healthy. Shame on us."
How is that the majority of the people are NOT in favor of this, yet the Senate is a go ~ with the add ons of SPECIAL interest groups in order to get the votes. And what's this about Obama and McCain supporting it? What happened to "change" that they both claim to want?
What I plan on taking away from the conversation - I don't want to pay for someone's golden parachute, unless they plan on jumping out of a plane with it. In the meantime, in preparation for the financial crunch, I'm trying to pay off debt and will consider creating savings in something other than the 401k. But I'm leaving my money there for the meantime. If 401k took a hit, it took a hit. I'm not living off of it any time soon.
Patience is a virtue, so I'm told.
I've advised friends for a while now that credit card companies are going to change their tunes. Hopefully a good deal of my friends are doing the same that I am - busting whatever piggy bank I have to pay off the creditors. I'm not far away from my goal.
Thankfully Greg, smart man that he is, has never owned a credit card!
I'd like to be in the same boat before we're married...
Dad: "I don't think that I, my children, or my grandchild, if there's every going to be any (me rolling my eyes at that moment) should have to pay for this mess. Did you hear about the 17 day man?"
Me: "No."
Dad: "The man was hired by one of the companies that is going under. He worked there for 17 days. Because he was hired and then let go, he was given a 30 MILLION DOLLARS severance! I don't think that the every day Joe should pay for this. And it's not about the mortgages, though that has something to do with the sway of things. Some places are feeling the mortgage problems with a decrease in the value of homes, but that was coming no matter what."
Me: "If it's not about the mortgages, then what is it about?"
Dad: "Remember how they tried to tamper with the social security funds not long ago? They couldn't touch it. It boils down to there are some people in this world that want control over this country's income. There's a lot of income out there in the 401k and they, those people, are playing with it. But these people also have a problem. The people who want the wealth of the country want to play the stocks, but all these every day Joe's like you and me who have 401k monies into the stock. Well, our 401k monies - that messes with these big time stock brokers. The some people can't figure out the stock, because us little guys move things around constantly. If those people put fear in us to get out, it leaves the bigger chunk of change to them and then they can control the game again. I got my money out of the 401k plan last year when it started."
Me: "Why didn't you tell me that? I still have monies in 401k!"
Dad: "Because I plan on retiring in 10 years. If you don't have to retire in 10 years, stick with it, roll the dice and you could make a killing."
Me: "So, you don't think the government should bail out these companies? I heard that WaMu is being taken in by Chase."
Dad: "Yeah, that's a big company too. International. We're talking, AIG, along with American General. And let me tell you, Chase is going to make big bucks. They are going to buy the portfolio at 33 cents on the dollar or something along that lines. And what? The mortgages aren't going to move. Chase will still own the property. The credit card accounts they can't collect will be sold to an agency for collection purposes. Companies like Chase who are more stable will come out of this great."
Me: "What about the every day people? What will happen to us? You were around for the depression years ago, what was it like, what do we expect?"
Dad: "Our company shouldn't be affected. We aren't borrowing money for our company. We're paying the bank back. And we can be there for the customers who can't get car loans and personal loans, because the banks are going to tighten up."
Dad continued: "Not much will happen to the every day living that you have if the government doesn't bail out those companies. What an individual will need to look at is his or her credit card limits. Instead of having a credit card limit of 10k, if the current balance is 5k, the credit card company will max it at 5,500. That's what you have to look out for. It will affect people who are used to living off of their credit card; those who are robbing peter to pay paul."
Sounds like to me, that this situation will force us to be credit conscious again. People won’t be able to get credit card offers left and right like you do in the mail every day.
Something smells that a politician is willingto bail out companies. Look, our small company, if we didn't make the payments to the bank, or if I *personally* didn't make payments to my mortgage company - is the government going to come bail me out?
I don't like government playing the stock market and I don't like the stockbrokers messing with my 401k.
Reading on another blog, the person wrote regarding the Senate:
"Watch as we selfishly mortgage our country's future so your portfolios stay healthy. Shame on us."
How is that the majority of the people are NOT in favor of this, yet the Senate is a go ~ with the add ons of SPECIAL interest groups in order to get the votes. And what's this about Obama and McCain supporting it? What happened to "change" that they both claim to want?
What I plan on taking away from the conversation - I don't want to pay for someone's golden parachute, unless they plan on jumping out of a plane with it. In the meantime, in preparation for the financial crunch, I'm trying to pay off debt and will consider creating savings in something other than the 401k. But I'm leaving my money there for the meantime. If 401k took a hit, it took a hit. I'm not living off of it any time soon.
Patience is a virtue, so I'm told.
I've advised friends for a while now that credit card companies are going to change their tunes. Hopefully a good deal of my friends are doing the same that I am - busting whatever piggy bank I have to pay off the creditors. I'm not far away from my goal.
Thankfully Greg, smart man that he is, has never owned a credit card!
I'd like to be in the same boat before we're married...
Comments
The bottom line is we have to live within our means and people who have been living off credit are going to feel it. Your post was incredibly helpful because what ever happens there also affects the rest of the world too. It is so immoral that someone could work somewhere for 17 days and get all that termination money. My daughter has told me so many similar stories such as this - she tends to come into contact with bankers in her line of work - law. One of them told her he was just going to France for the rest of the year to have a long holiday and hope by the time he returns it would have all blown over. How is it possible?
Good luck with wiping out your credit card debt. I think we should all talk to our parents and grandparents because even in my lifetime (and I am in my 40s) I have never experienced great financial issues due to the economy (moreso my own stupidity). However, my parents lived through the depresssion and always lived their lives being financially prudent. Always paid off things, never spent more than they could afford etc. I think your post is excellent and if you dont mind I would like to link to it in one of future posts which was going to be about personal responsibility. Oh by the way Greg gets another thumbs up from me, sounds awfully sensible.
Great post Aleta.
Although I am not directly affected by whats happening in the US, stuff in the newspapers etc tends to confuse . So it was nice to read what your father had to say about whats happening.
About Greg and credit cards , ....is Greg for real ? ....:-)
best wishes to you both.
I agree whole heartedly with the 'live within our means' because I think for too long we've been living outside of them. Time to take personal responsiblity for our actions.
Have a great weekend!
~K
Here’s a link about credit cards sent to me from Greg:
http://www.whatprice.co.uk/credit-cards/credit-card-company-tricks.html
Hi Ugich Konitari ~ I’m smiling because your comment “is Greg for real?” I asked myself that same question many times when we first started dating. Then I met his family. Yes, he’s for real and he comes from a very kind-hearted, loving family. As for his credit card no usage, that comes from a good education as well. I wish, truly wish, that personal finance was a mandatory class for all students at a young age. Before college, because that’s when the credit cards go after that population and sucker you in. Greg took a class in high school with personal finance and it taught him, “the dollar already is diminished by taxes when you make a purchase and if you buy something that decreases in value after it’s bought, then the dollar is worth less, but when you put it on a charge card, the dollar is decreased in a compounded way because of the interest that you pay unless you pay the credit card off each month and let’s not talk about the annual and usage fees.” And yes… he’s for real. I saw his credit bureau report!
Hi Lauren ~ I’m not disagreeing that laws need to be changed, but I am not willing to mortgage my future or my (hopeful, maybe one day) children’s future for the faults of not living within our means. Do I think they will change the laws completely? Absolutely not, because people don’t like change, because too many people at the top have too much to lose if we do. There isn’t a quick fix to this problem and we earned it. We have to own up to it and figure out what it is that we can live with and without. There will be some domino effect. I agree, but to what point is the media bringing this to. People who are living on credit cards won’t be able to. There’s going to be hardship but that’s coming no matter what, in the face of higher taxes, higher interest rates, a debt that we will pass down to our children, and/or dealing with it the slow and painful way, but it’s coming. That domino effect has started and it won’t stop, even if we attempt to slow it.
Hi Kel ~ The economy isn’t what we grew up with, but then, we have a lot more toys now than we ever had back then. I know that if need be there are definitely some things that we can cut back on in our household expenses and I don’t mean shopping… I’m talking cable, Internet (oh no! Lol), and so forth. People are fairly resilient, we’ll find a way, but it has to be us and not the government. The government won’t look after the people.
Hi Lindsey ~ The people who have the most to lose if those companies go under are the big giants with the fat wallets. There is going to be movement on the individual's part, no matter if the government helps or doesn't help.
Whoever is running the company - it's going to change hands and with the change of hands, means the termination of jobs for some and the start of a new job for others.
If you represent the government OR a new company buying in someone else's problem, either way, most likely you won't keep the current employees after the "adjustment" phase ended. That's common business practice. I don't like it, but it's there.
The bailout bill doesn't secure the individual.
One of my friends sent this site to me:
http://www.nowallstreetbailout.com/
Either way, I'd still recommend that we get out of the credit card debt. It's money that you don't have. Our parents and grandparents managed to live within their means, it's time for us to figure it out as well.
Great post. I ‘ve been very lucky through all this. I paid off everything including my mortgage when I retired four years ago. I know that’s not feasible for everyone, but if I were younger and still working, I’d sure be making every effort to do so- even if it meant modifying my lifestyle.
It goes without saying that things will probably get worse before the years out. We haven’t hit the bottom yet. As I write this comment, Congress just passed the bailout and Bush rushed to do a news conference stating that ‘safeguards are in place.’ It will be interesting to see the backlash. Bet it starts Monday morning.
Vikki
For long a few folks ( me included) were crying our throats out that 'vlaue and valuation' being at two ends of the spectrum is a recipe for disaster !!
You seem to have some pragmatic men with you !!
Lucky You !
:)