Word: bailouts
(lookup in dictionary)
(lookup stats)
Dates: all
Sort By: most recent first
(reverse)
...what’s past is not prologue. We should not ignore the second question in our eagerness to address the first. It might be useful to have Senators John McCain and Barack Obama in Washington this weekend to wrangle over the specifics of the proposed $700 billion federal bailout of Wall Street. But, truth be told, their return is not essential. Neither McCain nor Obama claims to be an economic expert. McCain, in particular, has openly confessed that “economics is not something I’ve understood as well as I should...
...proposed $700 billion bailout of the nation's beleaguered financial markets has become a taffy pull between the Bush Administration and lawmakers from both parties. Many on Capitol Hill believe Treasury Secretary Henry Paulson is seeking too much unregulated cash and power in his effort to stabilize the economy by buying up toxic mortgage-backed securities. He's also asking Congress to lift the ceiling on the national debt to a record $11.3 trillion from the current $10.6 trillion, which could weaken the U.S. dollar, raise interest rates and act as an additional drag on the economy. All that money...
...Will it really cost $700 billion? The dollar estimate of this bailout is just that - an estimate. Think of it as that bubble that slides up or down inside a level: it keeps moving, and where it ends up depends on who's talking. Some optimists think the mortgages the Treasury will buy are basically sound, and that the ultimate loss to the government after it sells them could be as little as $100 billion. Others point to a drop in housing prices of nearly 20% since mid-2006 and say the government's eventual loss could approach $1 trillion...
...this kind of bailout unprecedented? The current financial Hail Mary is much different from Washington's late 1980s rescue of the nation's savings and loans institutions. This time, the Federal Government wants only to carve out and buy poorly performing mortgages and securities, not the institutions that issued them, which had already gone under (or were on their way) when the Resolution Trust Corporation took them over. Richard Kogan, a federal budget expert at the nonprofit Center for Budget and Policy Priorities, says that buying all those bad assets creates "the greatest possibility of giving the taxpayers a bath...
...What happens if the cost tops $700 billion? If more money is required, additional legislation would have to be approved. The odds of that happening depend on whether or not the bailout stabilizes the housing market - the better the U.S. economy, the smaller the bailout will cost taxpayers. And it also depends on how the final bill is worded - the initial draft included ambiguous language that some observers have argued gives the Treasury power to spend more than $700 billion, as long as it isn't holding assets worth more than that at any one point in time...