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While in principle I don’t ever believe in bailouts of any kind, not bailing out the banks would have led to an apocalyptic situation probably worse than the Gr

by mruts 7y ago

While in principle I don’t ever believe in bailouts of any kind, not bailing out the banks would have led to an apocalyptic situation probably worse than the Great Depression. Sometimes those in power have a responsibility to the people instead of some idealistic morality.

luckylion 7y ago
There's the alternative of nationalizing them before bailing them out if they are too big to fail. When they are stable again, you can put them back on the market. With the 2008 setup, there is little incentive not to repeat it.
mywittyname 7y ago
We could have bailed the companies out while tossing the executives who facilitated this crisis into the gulags.
- mschuster91 7y ago
  Not that I dislike the idea of putting bankers into gulags, but I believe taking away all their wealth and seizing eveything they earn above poverty level for life would be more of an effective punishment. Also, the shareholders of such banks should be held accountable - the banks in question should be dissolved and the assets distributed to the public/the state. If shareholders do not have to fear total loss as a consequence of managerial misconduct they will not have any incentive to put actual controllers instead of yes-men to the boards.
smcameron 7y ago
And now the banks have learned they can hold the economy for ransom.
appleflaxen 7y ago
yes, that's exactly what the bankers told us (via their special interest politicians who were given the talking points) do you believe them? and even if you do, why are they allowed to remain that big? this is exactly what "too big to fail" means, and why it's a problem.
smolder 7y ago
It seems like you're presenting a false dichotomy, where the options are the bailouts we gave, or nothing. We could have bailed out the banks without rewarding all the bad actors involved at the same time, i.e. harsher terms for the bailouts. What we actually did is broadly excuse impropriety in the financial sector.

by mruts 7y ago

luckylion 7y ago

There's the alternative of nationalizing them before bailing them out if they are too big to fail. When they are stable again, you can put them back on the market. With the 2008 setup, there is little incentive not to repeat it.

mywittyname 7y ago

We could have bailed the companies out while tossing the executives who facilitated this crisis into the gulags.

mschuster91 7y ago
Not that I dislike the idea of putting bankers into gulags, but I believe taking away all their wealth and seizing eveything they earn above poverty level for life would be more of an effective punishment. Also, the shareholders of such banks should be held accountable - the banks in question should be dissolved and the assets distributed to the public/the state. If shareholders do not have to fear total loss as a consequence of managerial misconduct they will not have any incentive to put actual controllers instead of yes-men to the boards.

smcameron 7y ago

And now the banks have learned they can hold the economy for ransom.

appleflaxen 7y ago

yes, that's exactly what the bankers told us (via their special interest politicians who were given the talking points) do you believe them? and even if you do, why are they allowed to remain that big? this is exactly what "too big to fail" means, and why it's a problem.

smolder 7y ago

It seems like you're presenting a false dichotomy, where the options are the bailouts we gave, or nothing. We could have bailed out the banks without rewarding all the bad actors involved at the same time, i.e. harsher terms for the bailouts. What we actually did is broadly excuse impropriety in the financial sector.