Stephen Matchett; 1/10/08
Everybody’s ok? No, I don’t know exactly what hit us either but it has left an enormous warehouse where Wall Street was, which the US Government wants to fill with money, truckloads of money, a trillion truckloads. After following the crisis closely I reckon I have as good an idea of what happened as anybody else; or, to put it another way, I do not have a clue in a bucket exactly what happened or what it will mean. Yes, I understand that people with whom you wouldn’t want to play Monopoly were running the US banking system, making money on loans to borrowers who would repay them the moment they won the lottery. I have understood the way the bankers sold these loans to other investors who in turn packaged them up to people who thought they were buying investments that were safe as houses, which they were as long as you define safe as worthless in a market where there is far more property than people who can pay for it.
See: http://www.theaustralian.news.com.au/story/0,25197,24427169-38856,00.html
Bailout sunk in storm of opposition
1/10/08
In the end, the financial markets did not stand a chance against voter antipathy, partisanship and election year politics. The defeat of the extraordinary $US700billion ($870billion) financial rescue package represented a perfect collision of the forces of modern politics — a fast-moving internet campaign, vulnerable incumbents, a weakened and unpopular president and a roiling presidential campaign – all working against the bailout. Polls showed widespread public opposition to the plan – the biggest federal intervention in financial markets since the Great Depression of the 1930s.
Many Republicans saw the setting-aside of taxpayer money as an unnecessary intrusion into free markets. Of the 19 most endangered house incumbents, 13 voted no.
See: http://www.theaustralian.news.com.au/story/0,25197,24427825-26397,00.html
