The Great Depression Part II Options

[fameONE]

Is another Great Depression right around the corner for the American economy? Considering two investment bank powerhouses (Morgan Stanley and Goldman Sachs)have become bank holding companies in order for a financial backing from the Federal Reserve (this is a really big deal), should we be concerned? Also, take into consideration Bush's bailouts and his $700 billion dollar plan to 'save the banks,' do you think we're in deep shit?

Debate.

[mipadi]

I don't know, I'm not an economist. What do you think?

[fameONE]

I don't know, I'm not an economist. What do you think?

I'm not an economist either, but the simple fact that I have stock in JPMorgan-Chase has me worried. This bailout plan could do one of two things:

1. For the greater part of fiscal year 2009, the stock market will be at an all time low in decades. Subsidiary companies and affiliates of major financial institutions will go under, people will get laid off and 401ks will be ripped out of the pockets of hard-working employees. With a proposed budget cut for the war, it will give the government a bit more money to play with. The American consumer will be back-handed with inflation and the entire country will continue to see a progressive rise in taxes (regardless of who the president is). Once the market picks back up and these companies get back to being the money-hungry superpowers they once were, balance will be restored to Wall Street. With this restored balance, our economy could potentially improve as taxes lower. "It will get worse before it gets better."

2. The worst case scenario would be the bailout plan failing immensely. George W. Bush could be, potentially, signing a check that his ass cannot cash, just in time for him to step out of office. Despite all finger pointing, the American economy will suffer. The Asian market is more likely to receive global financial assistance because of the backseat that they've taken (primarily Japan) in the current international affairs. Countries like Sweden, Norway, Denmark, United Kingdom, Australia, Germany, Japan, etc, could view 'helping out the US' as a move that would be detrimental to their own economies, leaving the US to deal with our history of reckless spending and borrowing. The Federal Reserve would be forced to step in, but how much money would 'the royal families of the US' be willing to contribute to the cause? Would they make sure that big business remains big business, while shitting on the little guy, or would the entire economy collapse entirely?