Today, at 9:30 Eastern, the House of Representatives Financial Services Committee held a hearing with United States Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke over the status of the multi-billion dollar bailout. The House Democrats questioned the decision to give AIG $40 billion more and whether to use part of the remaining funds to help stem foreclosures instead of injecting the money, as the bill was written, in to the banks to help unfreeze the credit market. The debate was pretty heated at times with Barney Frank interrupting Secretary Paulson mid-sentence on several occasions. I'm glad that someone is pressuring Paulson and Bernanke, but this was a bit rude imho.

As you may well know, my approach would utilize more of the Free Market theory, but I do understand that it was not the Free Market that got us here in the first place. This makes it very hard for the Free Market to correct itself without hurting MANY people and companies in the process. Unfortunately the current bailouts and stimulus plans are only prolonging the hurt just as they did during the Great Depression.

I am a bit uncertain of the conditions in which the House Democrats wish to use the money to stem foreclosures, but I did hear Barney Frank mention reducing the mortgage value (lowering the amount owed on the mortgage) or issuing new mortgages with lower interest rates.

I'm confused...
Weren't artificially low interest rates partially to blame for getting us in to this mess? So let me get this straight; we are correcting the current excess lending problems by injecting more money in to the banks to be leant out by the same people that got us in to this mess in the first place?

Like I said, I could be confused, and could be completely misunderstanding Mr. Frank, but this just seems to be disastrous. If this is the case, I regret being fiscally responsible in my decision to not purchase a home the past few years seeing that Big Brother may bail ME out.

When Jesus Obama takes the wheel everyone will line up for a little government bailout, but is this the true salvation? NO, this is called Tax and Spend economics. YOU will be taxed, and THEY will be spending. This is not good for our market, nor our freedoms, nor our country as a whole. When the government bails out, they essentially own a part of that company/industry. I'm not trying to become a conspirator, but I HAVE read 1984. When government is given a little power, in times of a crisis, it rarely gives that power back. Remember 9-11? I'd love for each of you to take a picture of your smiling mugs the next time you are going through security at the airport. [/sarcasm]

The world was astonished at Washington's self-removal from the national stage. When King George III was told in 1783 that Washington declined further power and wanted only to return to his farm, he declared, "If Washington does that, he will be the greatest man in the world." Washington returned to his farm. Washington would have been astonished that we have developed a governmental system where people are politicians as a lifetime occupation and profit handsomely thereby.

What Would the Founders Do? - Richard Brookhiser

This crisis is only a little different than 9-11, with respect to the economy. After 9-11 there was MUCH hope that the economy would rebound because it was a terrorist attack that caused the sudden drop. Now it is of our own doing. The difference is the amount of [consumer] confidence now vs. then. People had a positive savings rate in 2001, which is not the case in 2008.

http://mwhodges.home.att.net/family_a.htm

With less savings, of course, comes less confidence. People [should] become tighter with their money, but this just doesn't seem to be the case.

http://mwhodges.home.att.net/family_a.htm

This is simply amazing. We are no better than our Federal Government!!! I don't understand how we expect to continue to be the most free and prosperous people/nation in the world when we are addicted to CREDIT!

This ties back to my original point about reducing the mortgages of all the people that are about to foreclose their homes. Yes, I have a heart, and I also understand that part of these people have lost their jobs because the economy has forced them to lose their jobs, but let's not forget about all the people that were falsely approved for home loans because of the Community Reinvestment Act. It is neither mine, yours, or the Federal Governments responsibility to bail you out of a house payment that you cannot afford. This is simple Free Market law. Bankruptcies are a part of the Free Market, and are in place for situation just like this. [/rant]

Stay Fresh.