RebelCapitalist: Financial Information for the Rest of Us

Consider This

Jun 30, 2010 | By: Mr_Blue | Comments | Permalink | Tags: unemployment, wall street bailout, economy

The $14 Trillion bailout of Wall Street is the largest transfer of wealth or distribution of income in U.S. history and what did it do for us?

Remember when we were told that the Wall Street bailout was necessary in order to free up lending to small businesses and us. Well, that certainly didn’t happen. Instead, financial conglomerates and Wall Street firms used the trillions of dollars to keep it internally to trade and continue to profit and give out huge bonuses. What about the rest of us - well, you know the story:

1) 9.3% unemployment - even higher if we consider the amount of underemployed people.

2) A record 40 million people on food stamps.

3) Over 1 million people losing an important form of income assistance - ie. unemployment insurance runs out.

4) Over 14% mortgage delinquency and foreclosure rate (as of 1st quarter of 2010).

It didn’t have to be this way. Policy makers in Washington from both political parties were replaying the old “Trickle Down” game that has proven to be a failure already. Sadly, nothing is changing. No one in Washington is talking about policies that will support the people who matter the most to a strong prosperous economy - working class people.

Consider this: with the trillions of dollars pumped into financial sector and financial conglomerates, Treasury Department through Fannie and Freddie Mac could have bought every struggling or troubled mortgage in the market. It could have truly modified/restructured the mortgages so that it would’ve benefited homeowners - lower payments and eliminate or ameliorate negative equity. But this would have been a defeat to status quo of redistributing income upwards.

Consider this too: In theory or at least as stated publicly, Washington bailed out Wall Street so that it can load us up with even more debt that we don’t want or need. When will the insanity stop?

Good luck.