AP article: Bush says anxiety feeding market instability

Of course anxiety is feeding market instability.  But what is feeding the anxiety?  That is the million dollar question.  If someone was on “Who Wants to Be a Millionaire” and needed to phone a friend for the answer to this question, I would recommend that they just pick a taxpaying American citizen (virtually any taxpaying citizen) to be their lifeline.  Anxiety is feeding market instability.  Government is feeding the anxiety.

People are experiencing high levels of anxiety because their representatives, the people sent to Washington to actually REPRESENT them, in large part voted for this $850 billion bailout despite receiving an overwhelming barrage of letters and phone calls from their constituents urging them to do just the opposite.  Now, people are freaking out about the market, and they are freaking out because they are afraid government is out of control (which it is).

In the article referenced at the beginning of this blog post, Terrence Hunt writes, “President Bush said Friday that the government’s financial rescue plan was aggressive enough and big enough to work, but would take time to fully kick in.”

President Bush is wrong here.  Things may get sorted out eventually, but the reason everything seems to be going to hell in a hand-basket right now is directly because of how aggressive and big this financial “rescue” plan is.  Congress, the one branch put in place to give the people a true voice in government, shirked its most important duty and did exactly the opposite of what people wanted.

So, yeah, anxiety is now feeding the market instability.  Remember when the House voted down the first bailout proposal?  The market saw a dramatic drop, and people freaked out.  But what happened the next day?  It stabilized, and I think it may have actually gone up a little.  At the very least, it didn’t keep plummeting.  What has happened since both the Senate and the House passed the bailout proposal?  The market has continued to drop day after day after day, and now it has actually crashed for the first time since 1987.

Think this anxiety is going away anytime soon?  Think again.

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Under capitalism, the free market has to be allowed to work. People and businesses have to be allowed to fail. Mother Government can’t come in and save the day by using taxpayer money to bail out people and businesses just because it hurts to see this failure. When businesses fail, a hole in the market is left behind. That hole will eventually be filled by some other business who is likely performing the same function and very well might even employ many of the same people who worked at the failed business.

I believe the same thing applies to failed mortgages. I hate that people are losing their homes, but that isn’t my fault and it isn’t your fault. We shouldn’t have to pay for the mortgages that couldn’t be covered by those who owned them.  Personal responsibility needs to be the theme of these times.  If there are consequences people must face as a result of their irresponsibility or ignorance, then they must be allowed to face them.

What will happen? Well, the market might struggle quite a bit (though, now it looks like that was going to happen with or without a bailout). Housing prices and values may drop significantly. But here’s the thing. They will likely drop to a rate to where average people can start buying homes again.

That, in my opinion, is where a lot of this got out of hand. Everything has been overinflated for so long that it has just been accepted that this how things are supposed to be. The market is down to below 9,000 for the first time in 4 or 5 years, and people are freaking out. What does this mean for the average person? Investments may be struggling a bit and that can hurt, but, otherwise, not a whole lot. Life will go on. And maybe with corrections in the market, life will become more affordable again.

But that likely won’t even be given a chance to work … at least not under the leadership of either of the two main presidential candidates.  They do not seem interested in allowing the free market to do its thing.

Even if this mortgage buyout WAS a good idea in theory, the federal government is one of the worst managed “businesses” in history. Do you really trust them to not bungle up a mortgage buyout? I guarantee that once all of those mortgages are bought up, we’ll just see some other huge mess as a result of it that will cost billions and billions more. Things NEVER run as smoothly as the government tells us they will.

As radio talk show host Phil Valentine always says, “The government should only do what the private sector cannot, will not, or should not do.” The federal government should protect us from foreign enemies and domestic violence. The government should not try to control the economy—at least not on the micromanagement level of owning and controlling businesses. The economy’s ups and downs should be a result of the free market being allowed to work.

But that’s just my opinion.

What a wretched excuse for a debate last night.  Neither candidate really said anything worthwhile in what could possibly be the most boring presidential debate I’ve ever seen.

All things considered, I think McCain probably lost this debate.  While neither candidate really gave us anything to make us feel good about how they can make America better, it was McCain who had the more urgent need to really stand out.  He is down in the polls and needed to make up some ground.  Based on his performance last night, I doubt that will happen.  He was too laid back, and he didn’t go after Obama when he needed to.  By not clearly winning this debate, I think he lost.

In addition to all of that, McCain also proposed a $300 billion plan to force the federal government to buy all of the bad mortgages in this country and allow financially troubled homeowners to keep their homes.  So instead of admitting he made a mistake by voting for the $700 billion bailout plan, he wants to spend MORE taxpayer money to pay for people’s bad choices.  Unbelievable.  I wish he would stop calling himself a maverick and actually BE a maverick.  The Republicans are on par with the Democrats in the wasteful spending category now.  The maverick thing to do would be to return to conservative ideals by getting the government out of our lives and wallets.

McCain’s handlers better get a grip and tell him he needs to actively go after Obama if he wants to win this election.  If he is as passive during the third and final debate as he was in the one last night, it’s over.  He also needs to care more about what matters to his conservative base.

I’m still conflicted.  I’m less enthusiastic about McCain now than I was before the debate.  That new $300 billion plan really made me angry.  But I still see him as the best chance for keeping Obama out of office so that we can at least avoid all-out socialism.  And I still like Palin and wish I could vote for her instead of McCain.

I just wish she could consistently pronounce the word “nuclear.”

(UPDATE: According to Michelle Malkin’s blog, the $300 billion proposal is part of the $700 billion proposal.  Not that that soothes my soul any.  It’s still, as she calls it, a “crap sandwich.”  I recommend you read the whole blog, as it is good information.

Also, as promised in one of my comments on this blog, I have the information showing how McCain’s proposal isn’t exactly original except for the fact that he put an actual price tag on it.  He said that it is not Obama’s or Bush’s idea—it is his idea.  If you read to the end of this AP article, however, it says:

In fact, at a news conference on Sept. 24, Obama said, “we should consider giving the government the authority to purchase mortgages directly instead of simply purchasing mortgage-backed securities.”

Days later, in a news release, he said he would “encourage Treasury to study the option of buying individual mortgages like we did successfully in the 1930s.”

“Senator Obama has been consistently calling for policies that would buy up mortgages and restructure them so that families can stay in their houses,” Obama economic adviser Jason Furman said. “He continues to support that and believes Treasury should use its authority in whatever way it can to bring about that goal, including buying mortgages directly.”

Welcome to the Republicrat / Democlican party.)

Umm, yeah, so when the stock market plummeted following the failure to pass the $700 billion bailout proposal in the House, weren’t we told that it was directly because of the House’s vote?  So, now that the Senate and the House have both passed the new bailout proposal (which includes an extra $100 billion in pork spending so that it can now be called an $800 billion rescue proposal instead of a $700 billion bailout proposal—try to follow that logic), and the market has crashed today nearly as badly, what exactly are we to glean from this bit of news?

Is this just a case of “damned if you do and damned if you don’t?”

If it is, I sure wish they had stuck with “don’t.”

Senator Richard Shelby spoke out against what Senators did last night when they voted to approve the “sweetened” bailout plan. I wish I could replace either one of my senators with him.  Check it out:

‘We Chose Panic,’ Senate’s Top GOP Banking Expert Declares as He Rips Bailout

Here’s a list of the senators who did not vote for this horrible bailout plan.  Take a good look at the list, and if you don’t see one or both of your senators on this list, you should seriously consider firing them when they are next up for election:

  1. Allard (R)
  2. Barasso  (R)
  3. Brownback  (R)
  4. Bunning (R)
  5. Cantwell (D)
  6. Cochran (R)
  7. Crapo (R)
  8. DeMint (R)
  9. Dole (R)
  10. Dorgan (D)
  11. Enzi (R)
  12. Feingold (D)
  13. Inhofe (R)
  14. Johnson (D)
  15. Landrieu (D)
  16. Nelson (FL) (D)
  17. Roberts (R)
  18. Sanders (I)
  19. Sessions (R)
  20. Shelby (R)
  21. Stabenow (D)
  22. Tester (D)
  23. Vitter (R)
  24. Wicker (R)
  25. Wyden (D)

So now it looks like the Senate is going to pass a revised bailout proposal, still costing hundreds of billions of dollars.  What has changed?  Oh, they have added lots of “sweeteners” to the deal, to make it more appealing to Senators who might have voted against it.  John McCain, Barack Obama, and Joe Biden are all likely going to vote for the bill … as are my two Senators from Tennessee, Lamar Alexander and Bob Corker.

As it is, I know for a fact I will not vote for Alexander or Corker next election cycle if this passes.  I’m not saying I’ll vote for their liberal opponents, but, at the very least, I will vote third party or not vote at all in those races if no third party candidates are available.

I’m more concerned with the presidential race.  I really feel like I cannot vote for people who are not representing my interests, and the fact that McCain is voting for this is making me sick to my stomach right now.  I was actually coming around and looking forward to voting for him in November, but now I’m thinking I might have to go back to my original plan of voting for Ron Paul as a write-in candidate.  I don’t know.  The only comfort I have is that I won’t actually be voting for McCain to represent me.  He is running to be the president, and, as such, he is not running to be a representative for me in government.  He is running to lead the government.  But I still have to take issue with voting for a leader who could make such a serious error in judgment.

These “sweeteners” are added in to make it sound good to the senators and their constituents, but what they are really doing is adding even MORE money to this whole proposal.  Yes, they are talking about some tax breaks, but what good are tax breaks unless their are cuts in spending thrown in as well?  But instead of spending cuts, more money is being spent!

All I can hope is that when this goes back to the House, the same people who shot it down the first time do so again.

This bailout has to be stopped.  We are the U.S.A. — not the U.S.S.A.  Well, at least for now.

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