I didn't say they should pass the bailout. I said that whatever they are going to do they need to make it a certainty, whether this is passing a bail out or not.

As things now stand nobody people who need to be making important decisions at various companies (and not just financial companies) are hamstringed because they have no idea what the marketplace will look like in two days. "We have a deal, no we don't, we'll keep talking for a week, we have another deal, oops now we don't, we'll try again but we'll definitely get a deal that will look roughly like this or something completely different."

Uncertainty is the great cause of the short term problems and by dithering the government is just making it worse. I'm fine if they end the dithering by saying absolutely that the sector is on its own.

Ok, so howzabout they say, We're not lifting a finger? I guess that's impossible. So the markets will have to roll.


I'm with DP ... this is the first time I've ever been glad to have no savings and no investments, and no real estate that I'm interested in selling.

That would be better than the present of "we're going to do something immediately" and then not. That is just creating more of what they are trying to reduce.

And no, it doesn't need to be permanent final answer. If they aren't going to get anything done until after the election, just say that so everybody knows what game they're playing.

While I'm not sure as to whether or not the bailout would help much, I disagree with the contention that voters aren't feeling the crisis in their lives. Three banks in as many months, every customer wondering what's going to happen to their assets, every employee wondering what's going to happen to their job. Approximately one million foreclosures in California alone are predicted for 2008...that's a LOT of people who are feeling this crisis in their lives. Face it...the nation's nervous. And not without reason.

Can't the Feds suspend trading untill we get past the immediate crisis (and start working on the long term crises).

Don't cry for me Argentina. I still have a job.

The merger was brought to my attention last Friday by my co-worker, Sean. Citi met w/ Wachovia to begin negotiations of a potential merger. Over the weekend things moved quickly and an agreement was made early this morning. Wachovia (unlike Washington Mutual / 'Wa-Mu') didn't fail but was encouraged by the FDIC to merge w/ Citi. The merger will be a $42 billion loss for Citi. Wachovia suffered a loss of $15 billion earlier this year but that was mainly due to the bad home loans that were acquired when Wachovia bought out Golden West. The merger won't be finalized til the end of the year. Some of the bank employees might get laid off.

So what does this mean for me ? Not much (at least for now). Though Wachovia Bank is having it's bank woes (like all banks right now), my company, Wachovia Dealer Services, is continuing to generate more & more revenue. Each quarter we set a new record high. Though we're only a small part of the Wachovia Corp. we're very successful. Citi has an auto finance division but it's much smaller than ours. There doesn't seem to be much cause for alarm where I'm at. So for at least the next 3 months it looks like it'll be business as usual.

Perhaps bank employees and stockbrokers are feeling it. I'm sure tons of investors are not happy. But that's not the same as widespread unemployment and starvation. Everyone's deposits are insured up to $100K per institution, and I'm sure those with more than that in the bank had the wisdom to spread it out over many banks (though, heheh, I don't know what happens when those 3 banks are now one bank due to buy-outs and forced mergers).


Meanwhile, investors have lost money ... ON PAPER, in abstract. And aside from stock brokers, there haven't even been job losses among bankers ... yet.


I'm not saying a major slowdown of the economy due to credit tightness won't lead to wider job losses ... just that the public at large is noticing NADA in their everyday lives right now ... while the government is claiming they need $2,300 right now from every single American or the Sky Will Fall.




ETA: zapppop, I am much relieved. I know you work for Dealer Services, but wasn't sure if your job would be duplicated by a similar CitiBank service. Whew.

Meanwhile, I was finally getting used to seeing WACHOVIA everywhere, and now it will be going away? I used to tease zapppop about the unwieldy name ... but even though the bank's new to L.A., it's been around for centuries. So this is rather sad. Wachovia is, apparently, not a Polish word ... but an American Indian word ... and the bank is finally going the way of the American Indians.

They could halt trading but that would be a disaster beyond words. Nothing makes people want to remove money from a marketplace faster than being told that they may not be able to get it out when they want it.

That's what brought down WaMu. WaMu's problems were significant but they were not immediate in nature. Until people began getting worried and withdrew $16 billion from deposit accounts in a week. Then once WaMu was out of the way the press could focus on Wachovia and the fear moved to them.

The same would happen if the markets were closed. As soon as they re-opened there'd be a huge rush to withdraw money from them in case they get closed again. It is one thing to temporarily close them in response to an external crisis such as 9/11 where a cool off can work. People don't know what the implications are and react out of blind panic that can cool down with a day or two consideration (plus, the infrastructure literally had to be checked).

But if the markets are closed simply to prevent people from responding to events in the marketplace then you'd see a global sell off. It would become a self-fulfilling prophecy of humongous proportions.

The more immediate impact on the public is already happening: no money to lend = no home sales or opportunities to purchase bargains, unless you have a substantial amount of cash reserve and/or someone willing to go private contract. Home equity has plummeted, especially in the markets that were most inflated; here in Spokane home values did not rise as rapidly or as high as elsewhere, so we are still sitting pretty good in that area. Our home is still worth what it was last year, and we haven't tapped into the equity very much so we have some wiggle room. We also locked into a 5.5% rate two or so years ago, so we're off that ARM that could have cost us a fortune. We don't have a lot of stock, but we also don't have a lot of debt- I'm with everyone else that lives paycheck to paycheck. In the long run we won't feel the hurt as bad as some. (I hope).

But how many people are tapping into their home equity right now? How many people are applying for unusual loans?


Until they start calling in peoples' credit card debt, I don't see how most Americans will care? They won't be doing that, btw ... because just as with the Savings & Loan crisis, credit card debt - with jacked up interest rates, fees, and penalties - is how banks are going to eventually get out of this mess. Consumers are going to pay for it one way or another.


Yes, businesses unable to get credit might mean layoffs. Wake me when that becomes widespread.