America’s financial crisis and the bail out plan…. (2)

                       As far as the bail out is concerned, I would like to believe that an Average American is not that stupid enough of not being able to see through things. Its sad that some self professed IVY educated jerk seems to think that he is more intelligent than most other Americans and using that Greek invention of sophistry is trying to recast what this Bailout is all about using thinly veiled rhetoric (in other words, its disgusting that, they’re trying to make people blind by pulling over a piece of cloth over their eyes). This is the fundamental problem with Wall Street – it thinks that an average American can’t possibly understand what they are doing so they call what they work in: instruments, vehicles, esoteric instruments, derivatives, exotic derivatives and what not. Then they say you need Calculus to understand it and you send everyone for the hills. Come on guys --- call a spade a spade --- those concepts are not that complex. At some point it’s called “GAMBLING.” And this is a BAILOUT.

                         If the system was working properly, an average American should be able to get a loan for federal rate + whatever premium his bank pays + a risk premium associated with him. But he cant, not because of him or the Fed but because banks are broken. Why are the banks broken, because they traded in junk derivatives that some 26 year old MIT math guy said had value using the integral sign’s (throw calculus at Wall Street and their eyes go cross eyed). So, the banks (Wall street) ARE broken or their credit is frozen because nobody can value the junk on their books.

                The banks extended loans to people probably it shouldn’t have. If the Fed makes available a facility for Financial institutions to "park" bad instruments, there is ZERO guarantee that those instruments will ever be purchased back.It's like me making a loan to you and saying, "sure dude, give me pieces of paper and I'll give you money which I might sell back to you tomorrow if you want to buy the little pieces of paper you gave me." Hhmmmmm  Are you going to come back for those pieces of paper that you can't value now? Who knows? Uhmmmm...that's a BAILOUT. Paint it however you want, put lipstick on it (no offence to the Vice presidential nominee plain), sugar coat it, call it whatever you want. ITS A BAILOUT.