Should the Government nationalize the operators that caused this mess?
In the US, corruption is negligible, but incompetence by regulators is rife.
As a result, the Government will pay more for the "bailout investments" than they are worth.
The vast injection of new money will cause inflation. Eventually, the Government will sell its "investment" at a loss. The loss is based on two grounds: (i) the underlying value was not there in the first place; and (ii) the dollar it gets back is not worth as much as the dollar it has spent.
But the really scary bit is that the bailed-out operators may not "do business" with the cash, but will put it in their pocket. In this case, the reason for the bailout is defeated and another great depression is inevitable.
The only "investment" that makes sense is to nationalize the operators that caused this mess. The Government should take over at a properly discounted current value all of the sharp operators' businesses.
To top it off, it should throw the operators in jail and confiscate their assets.
Answers
3963 points
MNSL answered one year ago …
Endcomp,s following statements worth to consider:
The only "investment" that makes sense is to nationalize the operators that caused this mess.
The Government should take over at a properly discounted current value all of the sharp operators' businesses.
There should be some monitoring systems to prevent mess like this in the future. Other wise almost everybody such as investors, superannuation holders, insurance policy holders, poor savors, tax players all will lose their entire money including retirements money times to come.
Forced credit expansion should be banned. Credit should go to productive areas if we want to see sustainable world growth and to maintain continuous positive environment for all types of businesses.
457 points
SallyG answered one year ago …
See my answer to "Will the market rebound. .. " asked today, Sept. 30, for my thoughts on proper regulation. Jail time, asset confiscation, and, equally important, BANS FOR LIFE on responsibility (make that privelege) of handling anyone else's money should be mandatory.
Nationalization? I'm not sure. I really don't trust our government enough to let them run our financial institutions (not that they could do much worse than recent financial execs), as well as our defense system and the infrastructure that they are quietly trying to "privatize", not to mention up attacking our civil liberties in the name of "security".
Investment banks pressed for no regulation of derivatives, under the radar, got them thanks to corruption and little oversight, and then took advantage to over- and abuse them. Reforming that would be a big step toward prevention of future debacles, IMHO.
(As for privatizing our infrastructure, h*ll, no. That belongs to the citizens of the United States, and government has been given, by those citizens, the responsibilty of caring for it, not to be shirked by selling it to the highest bidder for exploitation.)
MNSL, you're right: credit for self-indulgence, on a personal or corporate level, is no good. While we might moan about tighter credit, the Chinese (who, it is true, have a very different system) have a rate of 7% compared to our Fed rate of 2%. Who has the money to buy foreign assets, and who is running up an ever-increasing national debt?
