I, For One am Glad the Bail Out Failed

Even though the markets tanked, I really didn't like the Bail Out plan and I'm glad it failed. I didn't think it was doing enough for the home owners. Its like we tax payers were paying all the debt, but not erasing any debt for the people who owe the banks. We would be bailing out investors, covering their loss.

While I did lose value in my 401k (I have lost value every quarter this year - - I'm doing the "buy low, sell high" chant right now) My other mutual funds pretty much stayed the same, no big change from last week. I am confident things will eventually go up. However, I don't think the plan Congress was voting on resolved the issue.

djshally had a great post today - - she broke out what $700 billion dollars was per person in the United States. It came out to about $2,292.00 per person. She posed the question, why doesn't Congress bail the American people out.

That amount would be a pretty big stimulus check for a lot of people.

I think Congress could kill two birds with one stone (as I said in my previous blog) if they would bail out the home owners. That is the root of the problem. If people are in foreclosure, the US government should step in and 1) pay their lender to get the home owner up-to-date with their payments; 2) purchase the loan and work out new terms with the home owner; and 3) Homeowners who purchased their homes in the past 5 years and who have seen the value of their home drop to an amount that is less than what they owe, the government could make a payment that would cover the difference.

The above would infuse the banking/financial markets with cash and save home owners from losing their homes. I know that if I were given a check for the difference in the value of my home now and what it was when I bought it, I'd pay off part of my outstanding mortgage with that.

I just keep picturing George Bailey handing out his honeymoon money telling people its just a loan until the banks re-open...

I remember from my political science courses that its better to give the people the cash because they are going to spend it and fuel the economy. Wealthy people tend to just save any additional money they get as do corporations. I was really feeling like we'd be throwing $700 billion into a black hole. Our law makers need to give the money to the people.

I do hope this is a wake-up call to all of us. We need to stop living beyond our means, that isn't the American way. The government has been saying we need to save more as a nation, and we do. There is so much we need to do that we've been saying we should do - - save money and develop alternative sources of energy so we aren't dependant upon oil.

The alarm is buzzing - - lets not hit snooze.