A few weeks back, we saw IndyMac bank get seized by the government, marking the biggest bank failure ever to happen in these United States’ history.Â So what happened today, you may ask?
The biggest bank failure ever EVER in these United States’ history.
Yessir, in a thrilling display of one-ups-manship, Washington Mutual imploded under the weight of it’s own bad debt and was acquired at bargain basement prices by J.P. Morgan Chase.Â Mind you, this is the same Chase that picked up the irreparably busted Bear Stearns a few months back.
So, with all these “too big to fail” companies experiencing shotgun weddings on Wall Street, what would happen if one of these newly consolidated “super-duper too big to fail” giants happened to take a sudden media friendly turn for the worse?
We don’t know.Â And if Hank Paulson and Ben Bernanke have anything to do with it, we never will.
The financial markets are in a controlled seizure right now as Congress puts together a â€˜financial resÂcue plan’ (i.e. a Wall Street bailout bill) with a cost of 700 billion taxpayer dollars.Â The provisions within the bill have been described as “involving a lot of experimentation”.Â Evidently, this is as good a time as any to try new and exciting things with our money.
The fact is, something is going to be hammered out, because legislature is too scared of the speculated alternative.Â And, since they have until Sunday at 8 pm (the time when Asian markets open), they’ll probably get it approved without doing their due diligence and will probably screw up a lot of stuff.
Hopefully, the overall effect of the plan will be worth the mountain of debt it will put us into.
Mortgage rates have gone up incrementally on the news, as a huge bailout will require printing more money, higher taxes, and a general erosion of our economy as a whole.Â
Here’s the bright spot amidst all of this: when the financial markets are whip-tailing all over the place, it gives you a chance to time the markets.Â With the right advice and knowledge, you can capitalize on an overly-large downswing in interest rates to buy a foreclosed property who’s value is artificially deÂflated.Â It’s like getting a good deal inside of another good deal (like a calzone, only with money).Â Lots of opportunities are out there for those looking for long-term benefits, and I would love nothing more than the chance to discuss them with you.
John McCain also changed his mind about needing a definitive answer to the financial crisis before debating Barack Obama.Â It’s always fun to see two political juggernauts go head to head in the midst of a growing and evolving crisis.Â Nothing says ratings like a nice bloody battle of wits.