I disagree, and find this a bit superficial

The visible part of said bailouts includes countless trillions sunk into vast tracts of enormous houses "owned" by thick-witted, semi-educated drones who never could have earned them in a billion years....

The short-term winners in the Ponzi scheme were the "drones" in the banks that pushed this poison, the media hacks who made their careers touting it, the real estate agents in every little town in America who seemed to grow rich beyond their wildest dreams (even though they may have failed at every other endeavor they tried in the past)... and so on.

Yeast makes flour and water bubble up real good -- but it will collapse unless you bake it.

Now we are about to bake the bubble.

Spengler over at ATimes has a great piece on why Congress is going along with this -- it is because USA is not a nation of sheep, but rather a nation of addicted gamblers: E pluribus hokum or
When the gamblers bail out the casino

Paulson's dreadful scheme will become law, because Americans love their bankers. The bankers enable their collective gambling habit. Think of America as a town with one casino, in which the only economic activity is gambling. Most people lose, but the casino keeps lending them more money to play. Eventually, of course, the casino must go bankrupt. At this point, the townspeople people vote to tax themselves in order to bail out the casino. Collectively, the gamblers cannot help but lose; individually they nonetheless hope to win their way out of the hole.

As of 1730 GMT, the Dow is down 230, 2%, and Nasdaq is down 58, 2.5%.

Market's down, dollar's down, oil's up, and gold's up.

Just another day at the bone yard.

Looks like oil is up limit at $123 & change. Time for a new poll?

Hello VK,

I might also add that some people prefer to hug their bag of NPK, too:

http://www.signonsandiego.com/news/business/20080922-0429-fertiliser-out...
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Fertilizer prices stay high as supply lags demand

...“Because supply and demand fundamentals are so incredibly tight, supply and demand fundamentals are a much bigger factor than production costs,” Rabobank analyst Joost Hazelhoff said.
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We are evolved to sit in the dark, but starvation is the insurmountable hurdle [see Haiti, Zimbabwe, etc]. Even through great FF pricing volatility, but mostly upward, people continually place a premium on I-NPK by food purchases.

Too bad our tax dollars are not buying the stocks of agricultural companies, afterall, job specialization depends upon food surpluses and I-NPK is nothing more than transformed FFs. My speculative 'Federal Reserve Banks of I-NPK' could have gotten a tremendous $700 billion dollar boost.

My guess is many of the Banker Boyz are shifting some of their ill-gotten gains into I-NPK stocks. The last thing these people want to do is to actually have to manual labor in a field. They hope to make another financial killing plus achieve 'Elemental Control' [see prior discussion in archives] so that they can force us and our children to do the stoop labor instead.

"Make us your slaves--Just feed us!"

Just remember that a farmer will trade for either I-NPK and/or O-NPK as there are No Substitutes to these Elements to leverage photosynthesis above a Liebig Minimum. Recall that the original banks held grain, not electronic zeroes and one.

A crust of bread has incredible power politically embedded within-- recall Tadeusz Borowski, #119198.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

Dollars gone down considerably, Oils up 10 bucks and gold is soaring since last week at 910!

Force them to mark to market?! The agency being proposed is free to buy assets at whatever price it wants, and it sure as hell won't be fair market price. The purpose here isn't to force these institutions to take losses, it's to funnel them money.

Maybe I should put it again: I am absolutely against any bailout. I just want to rationalize it. It makes me sick as anyone else here that people who over indulge with their spending will be given another round of dope (and 80% of sound consumers will pay up). You have to agree though, that the society we have today is built around consumer. We can change that, of course, but until we absolutely have to, we probably will not. Of course one day the game will have to stop. I think that if you cut off that 25 million of crazy consumers, the world we know would change a lot. Not only for them, but also for other people, because their standard of living often is a function of disfunctional consumers spending.

There are approximately 116 million households in the US.

Of those approximately 1/3 do not own their home. That means about 39 million households rent.

That leaves 2/3 who own their home, and of those approximately 1/3, or 26 million households, own their home outright--they owe nothing on their home.

I don't have any figures on this, but let me venture a wild guess and say that, of those who do have a mortgage, half are in good shape with their debt-to-equity and/or don't have any problems making their payments. That's another 26 million households.

So here's how it adds up:

People who rent--39 million
People who owe nothing on their home--26 million
People who are in good shape on their mortgage--26 million

Total "consumers" who would not benefit directly from the bailout--91 million

Total "consumers" who might benefit from the bailout--25 million

I see some problems with the numbers, but this may be nitpicky.

I've heard that 33% of all residential RE is owned free and clear. That's a portion of the total 116M. Your numbers assume that none of the rental properties are owned outright. Conversely, they also assume that none of the rental properties are in arrears. I would think that straight rentals are irrelevant. The property they occupy must be owned by someone.

So, properties owned outright - ~39M.
Properties mortgaged - ~77M.

I don't think that a person's equity position in their home should matter. Can they make the payments is real question. Given that, data shows that only 6.41% of US mortgages are delinquent.

So, I'd estimate that only ~5M mortgage holders are in real trouble.

But the mortgage market is like the dehydration in the human body. You don't need to lose a big percentage before big problems occur.

Did you calculate for people who had paid off their first mortgage but have a reverse mortgage?

Also, the averages say Americans move house something like once every 7 years, so that could mean that roughly 50% of them moved house in the last 3-1/2 years. This means your 'half in good shape' with their debt/equity might be too high since today minus 3.5 years is mid-bubble, not pre-bubble.

Yes, Gini measures income and not wealth and - as you know - the elite didn't cease to exist, but their relative income did fall in the years after 1929. I'm sure they are opposed to that, and will do what they can to minimise the extent to which it happens this time.

Where does the treasury get this $700 billion from anyway? Doesn't it borrow it at interest (by issuing treasury bonds) from the same wealthy elite it is actually being given to?

It's perverse, and hardly anyone notices.

If they ran the bail out in the same way as they did the RTC in the 80's, companies would have to go through bankruptcy, and the fat cats who have screwed things up would not remain in charge.
However, what the government did was to use taxpayers money to put liquidity into the system, so that overall people were able to get loans etc.
It is the difference between a perfectly reasonable plan to keep the economy collapsing, and the present scam which is a naked power grab, is entirely unconstitutional as it explicitly rejects the arbitration of the courts and which is solely for the benefit of the same criminals who have creamed off billions whilst wrecking the economy and people's lives.

I can not log into my Bank of America account this morning - should I be worried?

Francois