Will bailouts become more frequent? - page 3.

Mauser

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Quote from: StonksStonksStonks on August 25, 2020, 12:35:59 PM

1989 - savings and loans bailout
2008 - banks bailout
2020 - covid19 bailout aka wall street bailout

bailouts get bigger every time. But will they become more frequent?? Do we need more bailouts to bailout the aftermath of the previous bailouts?

I don't think the banks are the problem at the moment. Bailing out Wall street again at the moment doesn't seem very likely. We probably will see more support for real economy rather than for financial services. The problem is that demand and consumption dropped in the real economy. People are losing their jobs and have less money to spend, the ones that still have a job and get a regular paycheck rather save then spend their money. Didn't most banks in 2008 paid back there bailout money? I think the government even made profits on some of the loans.

davis196

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Quote from: StonksStonksStonks on August 25, 2020, 12:35:59 PM

1989 - savings and loans bailout
2008 - banks bailout
2020 - covid19 bailout aka wall street bailout

bailouts get bigger every time. But will they become more frequent?? Do we need more bailouts to bailout the aftermath of the previous bailouts?

When the economy is growing the companies are whining about government regulations and taxes.
When the economy is in a recession/depression all the companies want the government to save them.
That's the hypocrisy of capitalism right there.
After several decades,the US economy will reach a point,where the companies will not be able to exist without constant bailouts.
This will be a government controlled economy,pretty similar to the communist centralized plan economy.

bits4books

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Crypto is not a religion but i like it

Or maybe we're just not going to save anyone next time? Why if no one appreciates it? And why if then there will still be a crash? Let it take its course and just see what happens in the end. Maybe this is the Golden path that we all need?

cryptoboss2020

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i think 2030 next bail out Cheesy

.... or war lol Cheesy

jaysabi

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Quote from: StonksStonksStonks on August 25, 2020, 12:35:59 PM

1989 - savings and loans bailout
2008 - banks bailout
2020 - covid19 bailout aka wall street bailout

bailouts get bigger every time. But will they become more frequent?? Do we need more bailouts to bailout the aftermath of the previous bailouts?

Three data points is hardly enough data to make a point, let alone extrapolate it into anything meaningful. Bailouts are generally bad because they take the consequences for irresponsible behavior out of the equation. They also skew the economics of investment and risk/reward. The people who want bailouts are those who have a lot to lose, so bailouts invariably favor the richest people in the economy while destabilizing the currency for the rest of us. Bailouts should be a measure of last resort, but "too big to fail" is now a permanent part of our lexicon to the detriment of us all (except the billionaire class).

jackg

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https://bit.ly/387FXHi lightning theory

Quote from: figmentofmyass on August 25, 2020, 02:26:29 PM

Quote from: jackg on August 25, 2020, 12:38:23 PM

I think we will soon just start to see government ownership of financial institutions instead.

2008 brought lots of market consolidation---USA giants like washington mutual, merrill lynch, and bear stearns were absorbed by the biggest banks, jpmorgan chase and bank of america. if a crisis hits, they'll get TARP-like bailouts while acquiring failing banks IMO, further consolidating the industry.

citibank actually did get partially nationalized after that crisis. i assume the government will sell their stake ASAP (like they did with citi in 2010) but i guess things could play out differently if the banks don't return to profitability.

I could see it being run as a committee type system where the best people that apply are put in charge of running it but then ultimate decision lies with the government - and shares aren't distributed (this might be how bulling societies were meant to work)?

That succession of smaller banks being absorbed by bigger ones, can't end well imo. You're going to end up with too much market dominance.

audaciousbeing

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Bailout will continue to happen as long as the conditions at the moment demands it. In 2008 during the recession a lot of families would have been further thrown into agony with government offering the bailout. In the current pandemic, without government intervention to families and the economy as a whole, there would be massive poverty in the land with companies out of business which further tank economic indices, any reasonable government needs to do everything needed for restoration.

figmentofmyass

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Quote from: jackg on August 25, 2020, 12:38:23 PM

I think we will soon just start to see government ownership of financial institutions instead.

2008 brought lots of market consolidation---USA giants like washington mutual, merrill lynch, and bear stearns were absorbed by the biggest banks, jpmorgan chase and bank of america. if a crisis hits, they'll get TARP-like bailouts while acquiring failing banks IMO, further consolidating the industry.

citibank actually did get partially nationalized after that crisis. i assume the government will sell their stake ASAP (like they did with citi in 2010) but i guess things could play out differently if the banks don't return to profitability.

jackg

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https://bit.ly/387FXHi lightning theory

With every bailout imo strengthens the control the government have on the banks and other institutions and heightens regulations.

I think we will soon just start to see government ownership of financial institutions instead.

StonksStonksStonks

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1989 - savings and loans bailout
2008 - banks bailout
2020 - covid19 bailout aka wall street bailout

bailouts get bigger every time. But will they become more frequent?? Do we need more bailouts to bailout the aftermath of the previous bailouts?

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