We (at least unemployed folks and such) should be able to take money out of our IRAs and 401Ks to pay debts and buy food et cetera. As the law stands now, we have to pay a 10% fine in addition to income taxes and payroll taxes. That stinks. Many people will do it, though, because they have no income right now.

While we do need to get toxic assets off the books so banks can lend again, this is an awful way to do it.

It's not just giving them a carrot for bad behavior, it's giving them a hot-fudge sundae followed by a massage with a happy ending.

We should be beating these people with a Cat o' Nine Tails. Figuratively, of course.

Maybe.

Seemingly so reasonable, but if millions of cash-hungry citizens are allowed to pull out of the market now, it would be bad for the economy.

/j

It was Paul Whatshisface that first started handing out money to failng banks in September. Where was the cry of socialism then? I guess if your party does it it's not socialism, huh? Even if it's the exact same thing.

Dammit! I hate when I can't remember this stuff till later!

You have to wonder when the Wall Street Investors who run the country are going to call up the Right Wing and tell them to knock off all the communofascist stuff before they derail the gravy train.

You also have to wonder what will happen to all those Right Wing media stars if they do manage to kill the Stimulus - the Stimulus that's about to save their corporate bosses' necks. Mass firings? Cries of "You'll never work in this country again!"?

A bank/company that was too big to fail was too big period.

I don't like Obama, never have. But if he and his Congress can see fit to enact legislation to this effect, I'll take back everything bad I've ever said about him.

But something tells me this, like the repeal of DOMA, is something the democrats won't "get around" to doing.

I'm getting my starving ass down to the new vacant lot before all the prime cardboard box spots are taken......

Word is, Congress is mulling over a tax incentive plan to help the starving unemployed masses buy a real store-bought tent.

American(Chinese Walmart)Dream, here we come.......WOO-HOO!!!

Every other day brings another article detailing the seething rage that Joe Q Public bears for the numbskulls in Wall Street. At this point, I think it would be helpful to point out that resistance is futile, and we might as well submit to the mugging of the taxpayer. I offer for your consideration the following:-

1. Market forces favour the consolidation of businesses because it imparts efficiency and economies of scale. Result? Big Corporations.

2. The American Constitution protects the right to make donations to your favourite causes, even if you are a commercial entity only seeking to safeguard your interests. And guess what, they have more disposable income. Result? Big Corporations own politicians, if not by campaign contributions, then by threats to make massive layoffs in key districts.

3. Bubbles will always happen. It is human nature to allow optimism to triumph over experience. We are hardwired to believe that it may just be possible to make money out of nothing. Case in point, at its peak the entire derivatives market was larger than the combined GDP of the whole world by several orders of magnitude. When you consider that a derivative is supposed to ultimately derive its worth from some kind of underlying asset, it seems pretty clear that something doesnt add up right? That didnt stop Wall Street's best and brightest from convincing themselves that they were creating real value. Ordinary folks got in on the game too. Flipping real estate for a quick return. Our only hope was for the Govt and the Fed to have the political courage to prick a bubble notwithstanding Wall Street Journal op-eds that they are getting in the way of private enterprise. If you still believe that such political courage exists on either side of the beltway, please refer to point 2 above.

4. Wall Street knows that faced with the prospect of a banking collapse, the Government will blink first. Sure they'll whine and moan and threaten to claw back bonuses, but ultimately they will cave. Why? Because they know that an economy running on cheap credit is the only game in town. Americans live far beyond their means, thats a fact. For that, you need banks with healthy balance sheets doing what they do best - making something out of nothing.

5. By a massive stroke of luck, the US$ is the world's reserve currency, so the faucet of cheap credit remains open. But wait a minute, you say, banks arent lending now, so whaddaya mean cheap credit. Listen, if any other country in the world had the US current account deficit, their currency would be pounded to sh1t by speculators, necessitating raising of interest rates. But for the aforementioned world reserve currency status, rates in the US would be in the high teens-low twenties. Optimistically. However, as other economies develop to superpower status (i.e. China, possibly the EU) the time may come when the US$ will cease to be the reserve currency. Maybe our politicians will have the foresight to reform the economy before that happens. Personally, I wouldnt hold my breath.

In short, the Government (and by extension the voting public) have no stomach for the kind of wrenching reform needed to get this country back on track. My advice to you? Wait for the economy to recover a little, get in on the game to make a little nest egg for yourself, then cash out and move to a foreign country before point 5 above kicks in. Better hurry though, Wall Stree execs already have a 2 decades head start on you and there are only so many places left on the lifeboats. Consider yourself warned.

It's soooooo cute.

"...cash out and move to a foreign country before point 5 above kicks in."

You have a suggestion? Seems our bankers done went killed the GLOBAL economy, not just the USA's.

The only places that are unlikely to crumble are China, India, and the assorted hellholes where there hasn't been a functioning economy in the first place.

Honestly, as bad as things are in the USA right now, and as worse as they might become, we stand to come through this disaster about as well as ANY COUNTRY ON THE PLANET.